Appraisal Before and After

When a house is purchased using a bank loan, an appraisal is always required by the lender to ensure that the property being purchased is worth at least as much as the dollar amount of the loan. This only makes sense because should the bank need to take over the property, it wants to be certain that it can sell the house for at least the amount of the debt. Be sure to hold onto this document and remember the name of the appraiser. After I finish remodeling my houses, I always call an appraiser to re-appraise the property. Generally this appraiser will perform an appraisal for marketing purposes at a reduced rate. I provide the appraiser with a list of my expenses including labor and materials. Documenting $10,000 in expenses is much better than having the appraiser guess at what you spent. Also, I provide my own comps for the appraiser. I ever so delicately explain to him that the comps I am providing are by no means the only ones he is to use but I tell the appraiser I am merely asking that he "consider" some of these. I use the www.zillow.com website to find my comps. If I have a 3/2, I only look at 3/2s. Don't try to compare a 3/1 to 2/1. That is not done unless there is nothing but 3/1s to compare to. In this market there are so many houses for sale there should be some exact matches in your areas. Also, try to compare Brick houses to Brick houses and Vinyl Siding to Vinyl Siding. Try to find houses as similar to yours as possible. Try to use comps from as close to your house as possible geographically. I try to stay within .5 mile and sales within 6 months. If I can find some houses on MLS for sale, I will include them too. Problem with MLS listing is that those are sale prices, not sold prices. We can ASK whatever we want for a house; the price it SELLS for is a much more important figure. For about $275, the appraiser will make the appraisal for "Marketing Purposes Only". This appraisal won't be good for a subsequent purchaser, but I do use this appraisal as a Markteting Tool. I show the prospective buyer the appraisal to justify the price of the house I am selling. Also, providing the buyers agent with a copy of the appraisal is a good idea. He or she can pass that on to the buyers appraiser and it might be used as a "guide" to make sure that the buyers appraisal is where we want it to be. I typically ask MORE for my houses than other houses in the neighborhood but my prices are supported by a recent appraisal by a licensed appraiser. The appraiser I recommend is John Jordan at The Appraisal Network. www.theappraisalnetwork.com.