Does an Appraiser Come Into Your Home to Do the Appraisal?
When you or your lender orders a full home appraisal, the appraiser must enter your home in order to complete the report. A full home appraisal involves the appraiser inspecting both the interior and exterior of your home. However, in some instances, lenders use other types of home appraisals that involve neither appraisers nor a physical inspection of your home.
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Inspecting Your Property
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The home appraisal process begins with a state-certified home appraiser visiting your property. The appraiser tours your home and takes note of any upgrades, as well as any issues with your home that could negatively impact the property price. Having inspected your home, the appraiser compares your property with similarly sized homes that have recently sold in your area. The appraiser determines a rough value for your home based on its size and dimensions before adjusting the value upwards or downwards to reflect the overall condition of the property.
Appraisal Process
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When you refinance or buy a home with a mortgage, your lender orders the appraisal on your behalf, but typically you must pay for the appraisal. Costs range from $150 to $450 for appraisals; although, if you live in a large home or you live on a home sitting on a plot in excess of 10 acres, appraisal costs are higher. It normally takes about a week for the appraiser to complete the report after visiting your home.
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Other Options
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When you take out a home equity loan or a second mortgage, many lenders opt not to order a full home appraisal and instead rely on data from an automated valuation model (AVM). AVM appraisals are computer-based reports that rely entirely on information related to recent property sales in your area to price your home. These reports cost between $20 and $30, so you save a lot of money if your lender allows you to use an AVM appraisal rather than a full appraisal.
Misconceptions
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Some homebuyers confuse home appraisals with home inspections, but the two reports are dissimilar and serve different purposes. A home appraisal provides your lender with a value for your home, whereas a home inspection provides the buyer with a detailed report on the state of a home. You do not have to order a home inspection, but many lenders recommend that you do so because home appraisals do not cover major issues often noticed in home inspection reports, such as sink-hole damage or safety hazards.
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