If you’re selling a home and the prospective buyer is using a mortgage, then the lender will require a home appraisal to be conducted.
But what is an appraisal?
An appraisal is a professional estimate of the value of a home conducted by a licensed appraiser who assesses the property’s condition, location, comparable home values, and other factors that could impact its value.
Who Orders the Appraisal?
The buyer’s mortgage lender orders the appraisal, but the buyer bears the cost.
What Happens During the Home Appraisal?
You don’t need to attend the appraisal. Instead, we will meet the appraiser at your home and walk them through the property, discussing the comps and stating our case for why we believe the purchase price is justified.
How Long Will the Appraisal Take?
Usually, the appraisal takes around 30 minutes, but the actual time may vary.
How Long Until We Receive the Home Appraisal Report?
You can expect to receive the appraisal results around one week to ten days after the appraisal appointment. Once the report is ready, the buyer’s mortgage lender will forward it to the buyer, indicating whether the property appraised at, above, or below the purchase price. The buyer’s agent will then alert us as to if the property appraised for value or under value.
What If the Property Appraises for Less Than the Purchase Price?
If the property appraises for less than the purchase price, we have a problem. The bank will only give the buyer a loan for the appraised value. In such situations, the buyer may come back to us, requesting a renegotiation of the purchase price. If we refuse to renegotiate, the buyer has to decide if they want to bring extra cash on top of the down payment and closing costs to closing or walk away from the deal. If the buyer walks away, the deposit is usually refunded in case of a low home appraisal.