2. Since appraisers use "comps" (comparable market sales) of local properties sold within the last six months to value your home, make sure to work with a great loan officer who will research comps in your area before ordering the appraisal.
3. If you use your own appraiser, research them first and ask your lender to cross check them for any potential issues that may delay the process. Great loan officers will always confirm your appraiser's credentials.
4. Direct your loan officer to work with local, experienced appraisal companies. Many homes are being inaccurately appraised these days thanks to the use of out-of-region appraisers. Local appraisers have a deeper knowledge of the surrounding neighborhood and should also be more easily available, which will help speed up your appraisal process.
5. The appraisal report is yours to keep. Find out in advance who pays for the appraisal-many times appraisal fees are the homeowner's responsibility.
6. Many new lending regulations require two appraisals-ask up-front whether you'll need one or two.
7. Consider choosing your lender before committing to an appraisal. Being comfortable working with your loan officer is imperative. They will often serve as the liaison between you and the appraisal company.
8. Make sure any major repairs are completed before moving forward with your refinance. Structural damages drive your home value down and jeopardize the approval process for today's popular government-backed FHA loans.
9. Don't overestimate the value of making cosmetic home improvements. In the appraisal world, only improvements that add square footage will significantly increase home value.
10. Rely on market value rather than tax assessments for a realistic appraisal value-in today's market, tax value and current market value may differ widely, but your lender can only go by appraisal value.
Your lender or real estate agent should explain the steps for the appraisal process up front. Be sure to ask questions so that you are as informed as possible. Please feel free to e-mail me for more information or for referrals on great appraisers in our area. I encourage you to pass this article on to any family and friends who might be considering a refinance.