Oh my! What an experience! Well, actually, Joe was a very nice gentleman, who was both courteous, professional and very experienced.
He also happened to be an appraiser! As we were talking, he mentioned that he used to play rugby, and was ‘the hooker.” (a position in rugby). What did you think?
A very important aspect of selling a home is the appraisal. If the home does not appraise, the buyers can either walk away, or, they can request that the sellers reduce the price of their home by that differential.
What is an appraisal? When a bank loans anyone money for either refinancing, a mortage, etc., they want to make sure that the money they loan is well spent. For example. A house is being sold at $500,000. The bank wants to make sure that the house is worth that $500,000, and they send out an appraiser to make that determination. The appraiser will look to see if the home compares with other recently sold homes in the immediate zip code, elementary school , street and area with a similar description. He will then adjust according to updates.. perhaps one home has central air conditioning, and another doesn’t…giving the home without central air conditioning a lesser value. Or, one home might have 3 bedrooms, and another 4 bedrooms with 1 additional bathroom, but slightly less property, and so he will adjust for that too. New kitchens, new bathrooms will also be valued higher, and so forth. The paperwork for the appraisal can take anywhere from a few days to 3 weeks depending upon how busy the apparaiser is, whether it is sent to a central office before being sent to the underwriters, etc. so it is always good to order the appraisal after you have signed contracts by both buyers and sellers.
The appraiser will also look at price per square foot. If the homes in the area are selling at $274 per square foot, then he will multiple the square footage of the home that is being sold by that number to further compare. It’s unealistic to think that a home listed at One Million Dollars will appraise in an area where very similar homes sell for $600,000, and so forth. If there is nothing similar within the immediate area, an appraiser is allowed to make adjustments of up to 25% with price and square footage, and to look beyond the immediate vicinity.
At the end of the day, you want an appraiser who works in the area, who knows what he is doing, so both seller and buyer feel comfortable. If a home should not appraise, the buyer can request an additional appraisal at an additional cost, or question the appraisal itself.
It’s important to have a good agent represent you in the process too, so they can advise you on those ‘comps’ prior to making a purchase or selling your home. No-one likes surprises!
Larchmont and New Rochelle are GREAT!
