Common myths about appraising

By law, an appraiser must be state-licensed to produce appraisals for federally-supported purchases. The law gives you the right to receive a copy of your finished appraisal from your lending agency after it has been produced. Contact Corrie Appraisal & Consulting, Inc. if you have any concerns about the appraisal process.

Myth: Assessed value should be equal to market value.

Fact: It might be that Illinois, like most states, supports the common myth that the assessed value equates to the market value; however, this is not often the case. Examples include when interior reconstruction has occurred and the assessor is unaware of the improvements, or when houses in the area have not been reassessed for an prolonged period of time.

Myth: Depending on whether the appraisal is produced for the buyer or the seller, the appraised value of the home will vary.

Fact: The appraised value of the property does not affect the payment of the appraiser; as such, the appraiser has no preconceived interest in the cost of the home. Obviously, he will complete his services with impartiality and objectivity regardless for whom the appraisal is created.

Myth: The replacement value of the property will be is on par with the market value.

Fact: Market value is acquired by what a willing buyer would be interested in paying a willing seller for a specific property, with neither being under duress to buy or sell. The dollar amount necessary to rebuild a house is what shows the replacement cost.

Myth: There are certain ways that appraisers use to determine the value of a home, like the price per square foot.

Fact: There are many differing formulae that an appraiser will use to make a detailed investigation of every factor pertaining to the house, such as the size, location, condition, how close it is to undesirable facilities and the opinion of value of recently sold comparable properties.

Myth: In a strong economy - when the costs of homes in a given region are reported to be increasing by a certain percentage - the values of individual houses in the proximity can be expected to appreciate by that same percentage.

Fact: Cost increase of a specific property must be determined on a case-by-case basis, factoring in information on comparable homes and other relevant elements. This is true in fair economic times as well as bad.

Have other questions about appraisers, appraising or real estate in Coles County or Charleston, IL?

Contact Corrie Appraisal & Consulting, Inc.

Myth: Just examining what the home looks like on its exterior gives a good idea of its cost.

Fact: There are a number of different factors that determine the value of a home; these factors include area, condition, improvements, amenities, and market trends. An exterior inspection definitely can't provide all of the data needed.

Myth: Since you're the one paying for the appraisal when applying for your loan to buy or refinance real estate, you own the provided appraisal.

Fact: Legally, the appraisal report is owned by the lending agency unless the lender releases their interest in the appraisal. Home buyers must be given a version of the appraisal report upon written request as per the Equal Credit Opportunity Act.

Myth: It doesn't matter to consumers what's in the appraisal so long as it meets the necessities of their lending company.

Fact: Only if home buyers examine a copy of their appraisal can they double-check its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. There is an incredible amount of data stored in an report that can be useful to the home buyer in the future, such as the legal and physical description of the property, square footage measurements, list of comparable properties in the neighborhood, neighborhood description and a narrative of current real-estate activity and/or market trends in the area.

Myth: The only reason someone would order an appraisal is if a house needs its price estimated in a lender-based sales transaction.

Fact: Based upon their qualifications and designations, appraisers can and may perform a variety of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.

Myth: You don't have to get an appraisal if you have had a home inspection.

Fact: Appraisal reports are nothing like a home inspection report. The job of the appraiser is to form an opinion of value in the appraisal process and through writing the report. A home inspector determines the condition of the property and its main components and reports these findings.