Appraisal myths debunked

Legally, an appraiser needs to be state certified to produce legitimate appraisal reports for federally-supported purchase. The law entitles you to acquire a copy of your completed report from your lender after it has been produced. Contact us if you have any questions about the appraisal process.

Myth: Market value will be the same as the assessed value of the property.

Fact: It is probable that New York, like most states, supports the suggestion that the assessed value equates to the market value; however, this is sometimes the exception rather than the rule. There are times when interior remodeling has been done and the assessor is unaware of the improvement or other houses in the neighborhood have not been reassessed for quite a while, it may vary wildly.

Myth: The buyer or the seller sometimes may have an influence in the value of the property depending upon for whom the appraiser is working.

Fact: There is no personal interest on the part of the appraiser in the result of the appraisal, therefore he will conduct his work with impartiality and independence, despite for whom the appraisal is conducted.

Myth: Any time market value is found, it should equate to the replacement cost of the property.

Fact: The way market value is arrived at is based on what a home buyer would be willing to pay a willing seller for a home without being under pressure from any outside group to buy or sell. If the home were rebuilt, the dollar amount needed to do so would set the replacement cost.

Myth: Appraisers use a formula, such as a specific price per square foot, to arrive at the worth of a home.

Fact: An appraisal report is an assertion of information based on the property's size, location, proximity to certain facilities, the condition of the home and the price of recent comparable sales. You can rely on Record Appraisals, Inc's staff to be honest in assessing this information.

Myth: As properties appreciate by a certain percentage - in a strong economic state - the houses within the same neighborhood are expected to increase by the same amount.

Fact: Any cost at which an appraiser arrives concerning a certain home is always individualized, based on certain factors pulled from the data of comparable homes and other considerations within the home itself. It makes no difference whether the economy is robust or terrible.

Myth: The home's exterior is determinate of the actual value of the home; there is no need to do an interior inspection.

Fact: To find an accurate price beyond all doubt, an appraiser must assess the property on a variety of factors based on location, condition, improvements, amenities, and market trends. Obviously, none of these variables can be found just by viewing the property from the outside.

Myth: Because consumers pay for the appraisal when applying for loans to purchase or refinance their property, they own their appraisal.

Fact: Legally, the report is owned by the lending company unless the lender releases their interest in the appraisal. By the Equal Credit Opportunity Act, any consumer asking for a copy of the appraisal report must be given one by their lender.

Myth: It doesn't concern consumers what's in the appraisal report so long as it satisfies the needs of their lending agency.

Fact: Only if consumers check out a copy of their appraisal can they ensure its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can serve as a record for the future, since it contains an exorbitant amount of information - including, but certainly not limited to 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 vicinity.