What Is A Home Appraisal?

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What is a home appraisal? #appraisals #appraisal #homeappraisal #realestateappraisal #realestate #realestateagent

If you’ve ever been in the process of buying a home, then you probably heard of something called a home appraisal.

If you're uncertain of what a home appraisal is and what it means I will be going over all that in today's video!

A home appraisal, by definition, is an unbiased professional opinion of the value of a property. This appraisal is required by a bank whenever a home is being bought, sold, or refinanced where a mortgage is involved.

The reason the banks do an appraisal when lending money is because that property serves as their collateral, so they need to make sure that the home's market value is on par with the contract selling price. This is the banks way of covering themselves in the worst case scenario that the buyer defaults on the loan and they need to liquidate the asset.

An appraisal is conducted by a licensed real estate appraiser who is specially trained to determine the value of real estate.

The cost of an appraisal will generally vary between $500-$800 and is considered as a closing cost of a home purchase or refinance.

An appraiser will determine the value of a home by considering several factors. Some of the most important factors are location, condition, square footage, bed count, and lot size.

An appraisal is somewhat similar to a comparative market analysis prepared by a real estate agent, as the appraiser looks at relative comparable property sales to draw comparisons to the subject property and determine the value.

An appraisal is an integral part of a real estate transaction, as it is usually necessary for the value to come in at the purchase price for the funding of a home or refinance.

Home sales are contingent on a sufficient appraisal, unless otherwise specified.

This also inadvertently serves as a protection and security for the buyer that to have the confidence that they are not overpaying for the home.

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