Financing in Ellicott City>Question Details

Cassandra Du…, Home Buyer in Bronx, NY


Asked by Cassandra Dunham, Bronx, NY Thu Apr 14, 2011

Help the community by answering this question:


Hi Cassandra,

In order to determine that the home (asset) that the bank is giving the loan on is valued at or above the purchase price, the bank sends out an independent appraiser to prepare a detailed analysis of value based on recent sold properties in that same area.
0 votes Thank Flag Link Fri Apr 15, 2011

An appraisal is needed by the bank to make sure the loan they are giving is justified by the value given in the appraisal. Many banks have you pay the appraisal fee out of pocket before the settlement, the fees can range from $200-$500/appraisal.

Good luck!
0 votes Thank Flag Link Fri Apr 15, 2011
Hi Cassandra,
The appraisal is part of every home purchase where there is bank financing involved.
An appraisal is ordered to reassure the bank that the house is worth enough money, in todays market, for the bank to make the loan you are asking them to make.
Hope that helps
0 votes Thank Flag Link Fri Apr 15, 2011
Hi Cassandra,
An Appraisal is a formal estimate of a home's value, unlike an informal Market Analysis performed by a realtor or home owner. A professional appraiser is licensed to make this determination based on a thorough look at a home: square footage, number of bedrooms and bathrooms, finished or unfinished basement, updates and upgrades, condition of the home from the roof to the lower level of the home, and most importantly, the value of similar home sold in the neighborhood in the last six months. This appraisal is an absolute requirement by the bank in order to FINANCE A HOME PURCHASE or REFINANCE an existing loan. Therefore a BUYER will have a home appraised as part of the loan process, and pay for this appraisal as part of the closing costs. A SELLER may order an appraisal before listing the home, so that the best, competitive listing price can be determined. Since the buyer's bank gets the home appraised, in this market it is a very good idea to spend the money upfront ($300-$500) for an appraisal upfront and sell the home in a timely manner for the best price, rather then pricing the home incorrectly and keeping the house on the market too long, which eventually drives the price of the home down. To answer any of your questions more specifically, please feel free to call me at:443-226-5046. I am always glad to assist buyers or sellers with their real estate needs! - Ana Gabrea, Realtor - Keller Williams Realty Centre, Columbia, MD
0 votes Thank Flag Link Fri Apr 15, 2011
The appraised value of a house is a certified appraiser's opinion of the worth of a home at a given point in time. Lenders require appraisals as part of the loan application process; fees range from $200 to $300.
Pat White
Re/Max Advantage Realty
Web Reference:
0 votes Thank Flag Link Thu Apr 14, 2011
Cassandra: The appraisal is ordered by your lender to make sure the home's value is what the asking price is. Lenders won't loan money on a home if it does not appraise. The term used for this is an appraisal contingency. Cash offers don't require an appraisal but some cash buyers obtain appraisals anyway.
0 votes Thank Flag Link Thu Apr 14, 2011

Do you have a specific question regarding appraisals? If so, the question is not fully showing up.
0 votes Thank Flag Link Thu Apr 14, 2011
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