Why Get an Appraisal?

There are several reasons why you may need or want to get a home appraisal, including:

Pre-Sell/Purchase Decisions –
Before you decide to sell or purchase a home, you must decide how much you should buy or sell it for. If you are the seller, you may want to find out so you can decide whether it is worth it or not to paint the house or put in new carpeting. If you are the buyer, you may want to have someone uninvolved with the transaction help you determine if you are paying too much (or too little) for the home.
PMI Removal –
Private Mortgage Insurance (or PMI) is supplemental insurance that many lenders ask homeowners to purchase when the amount loaned on the property is more than 80% of the value of the house. The Homeowners Protection Act of 1998 requires that lenders drop the PMI payments when the loan to value ratio conditions have been met, however many require an appraisal to support the homeowner’s assertions of the value increase. Getting an appraisal and dropping your PMI payments can significantly reduce your monthly payments.
Estate Planning –
The loss of a loved one is a difficult time, and often this sad event is complicated by difficult decisions regarding the disposition of the estate. Settling an estate usually requires an appraisal opinion to establish fair market value for the residential property involved.
Divorce Settlement –
Finalizing a divorce involves many decisions, including property disposition. There are generally two options: the house can either be sold and the proceeds divided, or one party can buy the other party out. In either case, one or both parties should have an appraisal of the residence.
Whatever your reason, chances are you will have to go through a home appraisal at some point in your life.
Most lenders are required by federal and state laws and current banking regulations to obtain an appraisal for most loans secured by real estate and all appraisals made for mortgage loans from federally insured lenders must be made by a licensed or certified appraiser

What is an Appraisal?

A home appraisal is an independent valuation of a home to determine its market value.

In general, a home appraisal is organized by a lender and is usually paid for by a buyer. All loans required an independent appraisal.
The reason the lender requires an appraisal is that you may think a home is worth money than it really is – leading you to make an offer that may be too high. If the appraiser leads the lender to believe the home is overvalued, the lender may feel this is a risk and may not grant you a mortgage.
Basically, lenders want to protect themselves by ensuring the property you are considering buying with a loan from their institution is worth its market value. THe appraisal helps ensure that you, the buyer, do not end up having negative equity on a home.

The Importance of an Appraisal
Getting a home appraised is extremely important for several reasons. As mentioned above, it can help you find out how much a property is worth. It can also help you lower your taxes and eliminate private mortgage insurance.
A licensed appraiser can also help you with estate planning, analyzing the feasibility of proposed improvements, determining the best use of property and with insurance valuations.

The Appraisal Process

An appraiser’s duty is to inspect the property being appraised to ascertain the true status of that property. Toward this end, an appraiser will analyze market data, including both historic and current comparable sales, current offers, pending sales and proposed improvements to arrive at an appraised value for your home. The appraiser will also compare your property to the broader market. Depending on the purpose of the appraisal, the appraiser might choose to weigh different factors more heavily than others.

In generating his appraisal, an appraiser will pull from a wide variety of sources, including a local Multiple Listing Service, local real estate professionals, county courthouse records, private data vendors, owner interviews, and his or her own personal knowledge. The quality and reliability of each piece of information will be weighed by the individual appraiser.

How an Appraisal Differs from a Home Inspection
You must keep in mind that an appraisal is different from a professional home inspection. An appraiser formulates an opinion of a property’s value for a lender, while an inspector educates the buyer about the condition of the home and its components.

The Ultimate Value of an Appraisal
An appraisal performed by a professionally licensed appraiser is an invaluable tool that will allow you to make a wise real estate investment and sales decisions.

Homeowner Appraisal Services
There are a variety of reasons why a homeowner may need an appraisal. Three of the main reasons are PMI Removal, Refinancing and Property Tax Protest.
Here at Humes Realty and Appraisal Service, LLC, we specialize in providing high quality appraisals for each of the above. We are also dedicated to providing our customers with unmatched customer service. We will work hard to ensure that all of your appraisal needs are met quickly and comprehensively.

Interested in Removing PMI?
Private Mortgage Insurance (PMI) can add thousand of dollars to your annual mortgage cost! So are you paying PMI right now as part of your monthly mortgage payment? If your down payment was less than 20% when you purchased your home, the answer is probably “yes”.
In most cases, mortgage lenders will remove the PMI requirement when the loan is 80% or less of the home’s value. This can happen as a combination of regular loan repayments and appreciation of your home’s value in a rising market. Contact your lender for their specific requirements. Lenders will not remove PMI unless you ask. Before they will remove PMI, most lenders require a full or “drive by” appraisal (a drive by appraisal would be less expensive for you.)
Call your lender, find out if they require and appraisal and, if so, what type of appraisal and then call us. We can help you reduce your total mortgage payments.

Home Seller Appraisal Services

If you are planning on selling your home, a professional appraisal is one of the best investments you can make. The appraisal will let you know how much your home is worth and will save you from losing money by undervaluing it or by setting the price too high and delaying or preventing its’ sale.

For Sale By Owner
If you plan on selling your house on your own, the easiest way to establish its’ value is to have a professional appraisal done.
At Humes Realty and Appraisal Service, LLC,we will provide you with a complete analysis of the estimate value of your home. Factors such as condition, proximity to schools and services, and overall neighborhood values all will be taken into account.
When it comes to determining the value of your home, there are three general approaches: the cost (or replacement) approach, the comparison approach, and the income approach.
In the cost/replacement approach, a determination is made as to what the cost would be to replace (rebuild) your home in today’s market. In the comparison approach, the appraiser determines what comparable properties have sold for in the last six months to one year. This approach directly compares your house to other properties, adding value for special items that your house has, or deducting value for items that you house lacks (in relation to the comparables). Unless your property is commercial or a rental property, the income approach will not apply.

Setting the Price on Your Home
Along with location and condition, the price of a house is a major reason why it does or does not sell quickly. Although the price should not eb dealt with lightly, some sellers have a tendency to emphasize it too much, ignoring the home’s condition and ending up with a house that is overpriced for its current condition and the overall market.
Then, even if the seller finds an unaware buyer that is willing to pay the high price, when the buyer applies for a mortgage, chances are very good that the lender’s appraisal will force the price back down to market value.

It’s Important to Get the Price Right the First Time
Here at Humes Realty and Appraisal Service, LLC, we specialize in providing high-quality appraisals that will allow you to set an accurate sell price for your home.
And you can also expect from Humes Realty and Appraisal Service, LLC, unmatched customer service. We will answer your questions, provide relevant recommendations, and work with you to resolve any issues that may arise in the quickest, most convenient manner possible.

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