🏠{Real Estate} Market Monday
Question: What is an appraisal and why does it matter?
There is an untapped, terrifying name that wrestlers really need to consider: ‼️The Appraiser‼️(along with The Underwriter, but that's for another day!) Okay, okay, I know I have at least 1 Appraiser reading this & probably {rightfully} upset that they're made the villain. BUT TRULY, one of the biggest hurdles in a real estate transaction often boils down to the appraisal.
👉So what is the point of an appraisal?
Any time a Buyer is getting financing for their home purchase, the lender has to ensure that they're making a good investment. And that's where the appraisal comes in.
There are 2 key pieces to that "good investment":
📍Value: An appraiser looks at recently sold, comparable properties to give their appraised value. Lenders cannot lend more than this amount, so if the value comes in lower than the contract price, negotiations begin as to who is "covering" the difference- Buyer (by bringing more money to closing) or Seller (by reducing the sales price) or a combination of the two.
📍Condition: Depending on the loan type, the Appraiser is also looking to ensure the property meets minimum requirements for a safe, sound, and secure home. For some loan types, this may mean something as seemingly insignificant as peeling paint that must be repaired. For others, the requirements are less strict. If the Appraiser finds a concern with condition, however, it must be remediated (and often re-checked by the Appraiser) before the property can be purchased.
But no worries: With an experienced real estate agent (and lender!) on your side, hurdles like the appraisal are easier to navigate, whether on the buying side or the selling side.