8 Common Questions Home Buyers Have About Appraisals

8 Common Questions Home Buyers Have About Appraisals

Unless you’re a real estate agent, you probably don’t think about home appraisals more than a few times in your life. (Considering how much time real estate agents spend worrying about them, you’re probably better off!) But when you buy a house, chances are a third-party appraiser will need to inspect the house and analyze whether you’re paying an appropriate amount for it.

That’s a good thing, because it ensures you’re not overpaying for a house, but sometimes an appraiser can make mistakes, or just has trouble justifying the amount you’re willing to pay due to a lack of data, or not understanding the current local market.

Ideally your appraisal will come and go without a hitch, and you might not even know it happened the next time you buy a house. But the more you know about the home buying process, the better off you’ll be. So let’s take a look at 8 common questions buyers have about home appraisals:


1. Do I really need one?



A lot of buyers are totally comfortable with the amount they’re offering for a house, and they don’t feel the need to have someone beyond the real estate agent they trust come in and say they’re paying the right amount. Unfortunately, if you’re getting a mortgage, which a lot of people do, your lender will most likely require that an appraisal be done so that they can be assured the house is worth what you’re willing to pay for it.


2. Who pays for it?



Umm, ahem, even if you don’t want one, and it’s more for the lender’s benefit, you actually pay for it. Usually you’ll end up paying for it at the closing as one of the various closing costs, so it probably won’t feel like an added cost, but it does surprise many buyers to find out it’s something they have to pay for even though it’s the lender who really wants it more than anyone else.


3. When is the appraisal going to get done?



Good question! Unfortunately, delayed appraisals are one of the things that lenders claim is holding up getting your loan approved, so don’t be surprised if you and your agent are asking this very question. It’s something agents find themselves asking lenders quite often, but getting a firm answer can be difficult. It’s really in the hands of your lender to order one, so it depends upon when they get around to doing it. And then it depends upon the appraiser’s availability as to when he or she will actually schedule a day and time to inspect the house.


4. Where is the appraisal?



Just because the appraiser finally gets over to the house to inspect it, that doesn’t mean the appraisal is done yet. They still need to do their analysis and write up a report. Ideally the appraiser will do it within a day or two, but (again!) it’s really out of your and your agent’s hands as to when it actually gets done.

But even once it’s done, you still might be wondering where it is! You might be paying for it, but you also might never even see a copy of it. You’re entitled to a copy upon request, so if they don’t send it to you, feel free to ask for it. The upshot to not seeing it is that it’s a good sign there was no issue with it, and your lender just filed it away as complete and satisfactory.


5. Where did they come up with that number?



On the other hand, you’ll probably become way more familiar with what an appraisal looks like if there’s an issue with the amount the appraiser says the house is worth. In that case, you and your agent will likely be taking a close look at their report and trying to understand where in the world the appraiser came up with the amount they claim the house is worth.


6. Why did they compare it to those houses?



Ideally the appraiser will compare your house to other homes that are fairly similar to it. But when the number does come in lower than the amount you’ve agreed to pay for it, a lot of times it’s because the appraiser did a poor job choosing “comparable” houses to compare it to. To be fair, sometimes there just aren’t many or enough of them to compare against. But sometimes they’re just plain wrong because they aren’t familiar with the area, or they just have a different perspective on the value of the house than you and your agent do.


7. Can I fight it if it comes in too low?



Yes! You and your agent can contest it and ask the lender to have the appraiser consider other, more appropriate comparable properties that will help justify the amount you’re willing to pay. If the appraiser still doesn’t amend the appraisal to a high enough amount, you can ask for another one to be done, but you might have to agree to pay for it unless you can prove that the first one was done incompetently.


8. Why did it appraise for the exact amount I’m paying?



More often than not, if the appraiser doesn’t come back with an appraisal amount that’s lower than what you’re willing to pay, their report will most likely say that the house is worth just about what you agreed to pay, or maybe a little bit more. Many buyers wonder how they could have hit the nail on the head with the amount they offered, but the reality is, the appraiser is just trying to justify the amount you’re paying for it, so they’re not concerned about whether or not you got a deal on it. So even if you got the deal of the century and bought a house for tens of thousands less than it should’ve sold for, don’t feel like you didn’t just because the appraiser didn’t say so in the report!


Did you find this blog helpful? Feel free to share it on Facebook, Twitter, and LinkedIn by clicking the green buttons on top.

Recent Blog Posts

Stay up to date on the latest real estate trends.

Signs a Buyer May Not Be Serious

Not every buyer who shows interest is serious about actually putting in an offer and moving forward with a home purchase, no matter how enthusiastic they may seem.

11 Things That Might Make You Feel Like Your Real Estate Agent Is a Secret Superhero in Disguise

Let’s take a look at 11 things that could be a sign that your real estate agent is actually a secret superhero in disguise

What Should You Not Say When Buying A House

For some buyers, stress and excitement can cause them to say things without thinking about them which could potentially cause the process to take a turn for the worse.

Feeling Like You Missed the Peak Time to Sell Your House? Well, It’s Not Too Late… Yet

The good news is you’re not the only potential seller feeling that way, and it’s not too late to capitalize on a sellers’ market.

Spring Living Room Ideas

Spring is officially upon us! Here are some of the spring’s biggest decor trends you can incorporate into your living room.

Things to Keep in Mind When Trying to Secure a Mortgage After a Foreclosure

No one wants to go through the foreclosure process, but if you have a foreclosure in your past, it doesn’t necessarily mean you won’t be able to get a mortgage.

How Long Does It Take To Buy A House

Buyers often wonder how long it’ll take to find the perfect home, so they can plan when to start their home search in earnest.

7 Things in a Home Inspection Report That Often Get Blown Out of Proportion

There are a lot of things inspectors include in their report that aren’t worth losing the house you love over.

Recent Study Finds That Price Is Becoming More Important Than Location to Homebuyers. (Spoiler Alert: Both Matter!)

A recent study is making headlines claiming that the majority of buyers now think price is more important than location. Are the tides changing? Find out in this blog.

Work With Us