Appraisals: Who’s Paying for it Anyway?

August 12, 2013

Once you have found the right home and are ready to move forward from your inspection, your lender will then perform an appraisal of the home. Unless you’re paying in cash, this will be a required step for your loan approval process. The lender being used to purchase your home needs to ensure the home you’re looking to buy, is currently valued at the price you have chosen to pay.

With that, an appraisal is typically an out-of-pocket expense for the Buyer and usually occurs prior to closing. The bank will order a third party appraisal company to go out to the property, review the property with its most recent comparables, check current market trends and bring back an estimated value. The appraiser is an individual who’s professional opinion will be one of the deciding factors that will effect the final approval of your loan.

Lenders require appraisals due to the fact that they don’t always come out with the value we all may expect. If your appraisal comes in lower than your purchase price, you and your licensed Realtor will look at the different options to move past the issue. If your appraisal comes in high, your loan will move forward and you’ll know you are purchasing the property for less then what it has appraised for and may have instant equity.

If you have any further questions on the process of buying a new home, or selling a home, please contact me today. I am a licensed Real Estate Professional in the Twin Cities Metro and Greater Minnesota Areas and strive to provide the best real estate service, with the support of my team the Better Living Group, for all of my past, present and future clients. My clients, are my friends.

appraisals250_250

Chelsea Knutson
Realtor- GRI, ABR, CDPE
763-496-2903
the Better Living Group
Keller Williams Classic Realty NW