Appraisals - Be Aware of the Guidelines
April 12, 2010
In olden times, real estate agents would prepare copies of sold property data that was comparable to their listing. They would give this data to the assigned appraiser in the hope that the appraiser would use the data in the official appraisal of the property. No more. Now appraisers are to be at arms' length from being influenced by either the lender or the agent.
Appraisers are assigned through a central clearing house on a rotating basis.
Appraisers measure the house and are especially on the lookout for additions. If there are additions, chances are very strong that the appraiser and the underwriter who reviews the appraisal will request copies of the permits. This is especially true if the square footage on the assessor's records does not match the square footage as measured by the appraiser. A possibility is that the appraiser will simply use the measured square footage to calculate the appraised value and because the property will now be smaller, it is entirely possible that the appraised value will be less.
Sellers and agents need to be sensitive to additions and/or discrepancies in the recorded square footage and the measured square footage. It is often wise to check with the local building department and get copies of all the permits. Sometimes a contractor takes out the required permit but fails to have a final inspection. If the addition was done without a permit, some municipalities do allow the owner to file for an "as built" permit so that the work can be legalized.
Bottom line for anyone doing remodeling of almost any kind - get a permit. When you decide to put your home on the market, you will be happy that you did and you will avoid a delay due to an appraisal problem.
In olden times, real estate agents would prepare copies of sold property data that was comparable to their listing. They would give this data to the assigned appraiser in the hope that the appraiser would use the data in the official appraisal of the property. No more. Now appraisers are to be at arms' length from being influenced by either the lender or the agent.
Appraisers are assigned through a central clearing house on a rotating basis.
Appraisers measure the house and are especially on the lookout for additions. If there are additions, chances are very strong that the appraiser and the underwriter who reviews the appraisal will request copies of the permits. This is especially true if the square footage on the assessor's records does not match the square footage as measured by the appraiser. A possibility is that the appraiser will simply use the measured square footage to calculate the appraised value and because the property will now be smaller, it is entirely possible that the appraised value will be less.
Sellers and agents need to be sensitive to additions and/or discrepancies in the recorded square footage and the measured square footage. It is often wise to check with the local building department and get copies of all the permits. Sometimes a contractor takes out the required permit but fails to have a final inspection. If the addition was done without a permit, some municipalities do allow the owner to file for an "as built" permit so that the work can be legalized.
Bottom line for anyone doing remodeling of almost any kind - get a permit. When you decide to put your home on the market, you will be happy that you did and you will avoid a delay due to an appraisal problem.
posted by shirley harry at 8:47 AM
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