Having an appraisal conducted is a key component of buying, selling, and refinancing a home. This process lets you and lending companies know the value of a house, which helps you secure a sufficient mortgage. In today’s blog, Family Home Loan Texas discusses the basics of appraisals and how they factor into homeownership.
What Exactly Is A Home Appraisal?
It is an unbiased determination of a home’s value. It is conducted by a third-party professional that looks at myriad factors. Some of these include the look and condition of the house, the price of similar homes that were recently sold in the area, current market trends, and included amenities. Once the appraiser considers all of this information, they put together a detailed report that states the value of the home. This report includes pictures of the home, a street map that shows the property and appraised price, the methods for determining the house’s square footage, and more. If the value is at or higher than the contract price, then the sale of the home can continue as planned. If it is lower, the transaction can be delayed.
How It Affects Buying A Home
It is one of the first steps once you begin the closing process of buying a home. It directly affects the amount of money a lender will provide for your mortgage. As a buyer, it can serve as a negotiating tool; if the value is lower than the asking price, it is likely in the seller’s best interest to lower the price. This is because a bank or private lending company won’t provide more money than the house is worth. It is ultimately one of the core steps of closing on a house, so you should anticipate that it needs to be done. It generally costs a few hundred dollars, so you need to factor the price into your overall budget.
A Refinancing Tool
In addition to being a key component of buying a home, a home appraisal also affects refinancing. If you are trying to refinance your home, and it determines your house is actually more valuable than your current mortgage accounts for, you will likely qualify. This will then allow you to qualify for a lower interest rate. However, if the value is lower than it was originally, you won’t be able to refinance.
Contact Us To Learn More About Home Appraisals
If you have more questions about home appraisals, please do not hesitate to contact us. Our vast knowledge about home buying can help make the entire process easier for you. Family Home Loan Texas was founded by loan originator and long-time mortgage professional Rob Bramer. Rob has helped clients secure the loans they need both locally and nationally and can help you get the loan you need to live life on your terms. Call 1-800-990-LEND (5363) to speak with Rob about how he and his team can help you through all aspects of buying a home — including appraisals.