Appraising in Delaware, the Blog...

February 9th, 2021 11:05 AM

 

Could you buy a house for $800? In the 1920s you could, just call Sears for a free catalogue. Do you know any Sears homes?


Posted by Patti Persia on February 9th, 2021 11:05 AMLeave a Comment

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January 4th, 2021 10:57 AM
Having a stranger come into your home can be uneasy on the best of days, but knowing you have an appraiser coming in to look around your home can have even the most relaxed people feeling a little anxious. It is always best to have a quick checklist to go over to help calm anxiety.

The most important thing you can do is to clean, so lets start there. It seems simple enough but a clean home will give off a completely different vibe than one that has not be thoroughly cleaned. If a home has piles of laundry laying around, dishes in the sink or paperwork on the counters it can be hard to fully see the home for how beautiful it could be. It is a huge distraction and does not allow the appraiser to take in the home completely. A good deep clean can make a world of difference.

Along with cleaning it’s never a bad idea to do some landscaping and cleaning up outside either. The landscape itself is not technically a part of the process, but having a clean yard, the grass cut, trimmed trees and some fresh mulch will also make things easier for everyone involved. Pictures are taken on both the inside and outside of the home and are quick reminders to the appraiser of the home. You will want these pictures to be a reminder of how beautiful your home is.

If you have any easy and quick repairs that you can do it would be another boost to the overall look. It can be as easy as replacing a missing board in a fence or repainting scuff marks on the wall. These repairs do not need to take days or cost you a ton of money, just remember that 30 minutes of your time here and there can really make a difference. There is a $500 rule you hear about in the appraising world; this rule says that most appraisers will measure the value of your home in increments of $500 and a few hours spent repairing a few different things can add $500 to the overall appraisal. Do that a couple of times and you are gaining or losing a good chunk of money.

Know the worth of your work. These days homeowners are always upgrading or finding ways to better their home. If you keep track of these upgrades and their costs you can easily share them with your appraiser. These can include, but are not limited to pools, appliances, solar panels and decks.

In these trying days of covid things have changed a bit for all of us and that does include appraisers. It was typical for appraisers to come in and interview homeowners to find out all of the information that they needed, and it was easy to know that someone would be home for access to the home. Now appraisers are typically doing most, if not all, of the interview process via phone calls, emails or texting. Be prepared for different modes of communication and remember to keep in touch – it can be difficult to get and keep the ball rolling if you aren’t able to be contacted easily.

It can be awkward to have someone walking around your home measuring and taking pictures, and if you are anything like the majority of us you wonder what you should be doing while the appraiser is at your home. There are a few things that can make the whole process quick and easy.

It’s totally ok to stay in your home, especially if there are pets involved - this also allows you to make sure the appraiser has no troubles getting in. Just try to remember that there will probably be pictures and measurements of the home that need to be taken so try to stay out of rooms the appraiser is in.

In the time of Covid, most questions will be asked prior to the actual appraisal. Your appraiser can do the interview over the phone or they may send you an email with questions that will help them gather important information on the home. Making sure this is completed prior to the appraiser coming can make thing run much smoother. This doesn’t mean they won’t have more questions along the way, so if you decide to leave the home for the appraisal be available for phone calls or emails with follow up questions.

The whole process should typically take about 20-30 minutes for appraisers who have all their information and know what they are looking for. This allows homeowners to schedule appraisals even when they have busy schedules of their own. A visit from an appraiser should be quick and painless, as long as you remember to communicate.

Posted by Patti Persia on September 29th, 2020 11:47 AMLeave a Comment

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5 Reasons Your Real Estate Appraisal Matters

Getting an appraisal back within a reasonable time frame can make or break a deal. If you’re in a rural area or in an area where the real estate market is booming, you could wait up to 3 weeks or more just to get the appraisal results. This can be even more frustrating if the appraised value comes in low or repairs are needed.

Right now there are even some areas in the country where appraisers are flat out declining appraisal orders because they know they do not have the capacity to turn the appraisal report around in a timely manner.

When the purchase contract states that the deal needs to close within 45 days, and it takes 40 days to get appraisal results, expect an extension to the purchase agreement.

Condition

If you’re getting a mortgage, the property needs to meet some basic standards for the lender to give the thumbs up on acceptable property condition.

Common property condition issues that pop up on appraisals and cause issues: mold in the attic or basement, peeling paint on the outside of the home or garage, trip hazards, broken windows, and missing fixtures.

Anything noticeably wrong with the property is likely to be pointed out on the appraisal report including photos. When there are repairs noted on the appraisal the seller will need to complete those repairs prior to closing, and the property needs to be reinspected by the same appraiser to confirm the requested repairs have been made.

Comparables

When coming up with an opinion of value, the appraiser selects recently sold homes within the market that are similar in size/condition/location/amenities.

The appraiser then compares those homes with the subject property and makes adjustments based on differences and similarities between the homes.

For example: if the subject property is a 3 bed, 2 bath ranch on .5 acre, the appraiser would look to include 3 bed, 2 bath ranches that sit on a .5 acre lot. The appraiser would not be including a 3 bed, 2 bath condominium.

It doesn’t have to be identical and size and condition, but it does need to be the same property type. Unique properties can be very difficult to finance. If there are no similar properties sold within a reasonable distance and time frame (underwriter discretion) the deal could be dead. There is also a limit to how much an appraiser can make adjustments on value based on the differences in homes.

If the adjustments made are too high, the comparable property used could be considered irrelevant or unacceptable and would need to be replaced by a better comparable if possible.

Confidence

For some buyers the appraised value can have an impact on their ego.

Let’s say you get under contract on a house for $300,000 and it appraises for $380,000. There might be an increased warm and fuzzy feeling knowing you got a good deal. Another confidence booster in a case like this is that if you’re going to be paying private mortgage insurance (PMI) due to a low down payment, you may be able to refinance in a year and then use the new appraised value to drop your PMI (which could save you hundreds of dollars a month).

Knowing that you have instant equity in the home that you already loved to begin with can really add a nice cherry on top.

Compliance

The collateral (the house) used to secure the mortgage must comply with lender guidelines.

One of the biggest issues when talking about compliance has to do with finding out if the home is a non-warrantable condo (does not apply to single family homes). If the property is a condominium the appraiser will reveal information pertaining to the number of units that are owned by 1 entity, number of units that are not complete, and other important information about the condo that could cause issues. [more on non-warrantable condos here]

Another fairly common issue that can come up as a compliance issue is number of acres the property sits on. Depending on what type of loan program you’re seeking, there may be an issue with giving any value to acreage beyond 10-20 acres. For someone buying a 50 acre property, this can be a deal breaker if most of the value is in the land.

If the appraisal states subject property was recently was sold, there could also be flipping restrictions depending on what type of loan you’re seeking.

The appraisal can clearly make or break the deal in several unique ways other than home value.


August 17th, 2017 5:19 PM
A FNMA appraisal report form can’t be completed if inspection access is denied to the appraiser. If the appraiser is denied access to any area of the property, the appraiser must stop the assignment and not complete the report until access to all areas have been provided.

Posted by Patti Persia on August 17th, 2017 5:19 PMLeave a Comment

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A home appraisal is the process of evaluating a piece real estate (can be a residential, commercial or industrial building built on land) and all it’s features to come up with a value of that property. An appraisal is normally performed by a professional appraiser who is trained to provide their opinion as to the value of the real estate and its building.

A home inspection is the process whereby a home inspector examines a home and all its major components to determine the quality of the components and also provides estimates of the longevity and usefulness of the components.


Posted by Patti Persia on August 17th, 2017 5:16 PMLeave a Comment

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For Delaware, with a 0.56% effective rate, property taxes account for 18.8% of revenue. New Castle County homeowners pay the highest median tax--$1,651--Sussex the lowest--$747.  Read more here ... https://www.forbes.com/sites/samanthasharf/2017/05/01/where-in-your-state-homeowners-pay-the-highest-and-lowest-property-taxes/#32bc9a516cfe

10 Tips on Inspecting Historic Homes Before You Buy | National Trust for Historic Preservation http://buff.ly/1YUape8

Posted by Patti Persia on June 28th, 2017 2:45 PMLeave a Comment

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