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What Westfield Buyers Can Expect From a Home Appraisal

January 8, 2021 by Scott Gleason

You decided to make 2021 the year that you set aside any home-buying myths you previously believed in and purchased a new property in the Westfield area. Congratulations! Part of your house-buying process more likely than not includes a home appraisal. Alleviate some of the stress of buying a house by learning why this is needed and where it fits in with your journey to homeownership.

When you have to borrow money to finance a property, your lender will require a home appraisal. What is it? Why do you need one? Who pays for it?

What to Expect from a Home Appraisal

What is It?

Click here for an instant "No Strings Attached" valuation of your home.Basically, an appraisal is the valuation of a property provided by an unbiased, third-party licensed appraiser. Unless you pay all cash for your new Westfield house, you need to secure financing for it. To do so, your lender will require a home appraisal. Your mortgage company wants to make sure that the property’s value comes in at or above the amount of money you wish to borrow from them. This only takes place after signing a sales contract but before final loan approval.

How Do Appraisers Determine a Home’s Value?

Typically, an appraiser uses a standard form called a Uniform Residential Appraisal Report. This form directs them to describe the specifics of the property in question (size, shape, view, zoning). It also asks about the type of utilities, foundation, gutter, and siding. Appraisers look at the general condition of the property and how the interior amenities fit in with other properties in the neighborhood. While not an actual home inspector, they may note potential issues they see (such as water damage or pest problems). They turn their completed evaluation in to the lender when done.

What Happens Next?

If the property’s appraised value comes in at or above the agreed sale price, your lender continues working through your home loan application. But if it does not, you have three options. First, you can use this information to negotiate a lower sale price. Second, you can come up with the difference between the sale price and the appraised value as part of your down payment. Or third, you can walk away. If your sales agreement includes an appraisal contingency, you walk away with your Earnest Money Deposit as well.

Who Pays for It?

This falls under the buyer’s responsibility. Your lender orders the home appraisal. In turn, they charge you a fee for the appraisal. Most of the time, it runs a few hundred dollars.

Finding a Westfield home you love and putting in an offer is just the first step in the journey to homeownership. This process tends to become stressful to many people. Knowing what to expect helps ease that stress a bit. When you decide you want to start your Westfield home search, contact me.

Scott Gleason, CRS at Coldwell Banker Realty – East, NJ Luxury Homes

Filed Under: Westfield Buyer Tips Tagged With: home appraisal, home buyer tips, how do home appraisals work, tips for buying a home, westfield real estate, what is a home appraisal, who pays for a home appraisal, why do i need a home appraisal

How a Home Appraisal Works for Westfield Area Buyers

August 26, 2016 by Scott Gleason

You have found your next Westfield home!  Congratulations.  As a condition of final loan approval, you need to have an appraisal done.  Unless you provide an all-cash offer, banks require a professional home appraisal.  You should know how a home appraisal works for Westfield, Cranford and Mountainside Buyers so you are a more informed consumer.

How a Home Appraisal Works for Westfield Area Buyers

Click here for an instant “No Strings Attached” valuation of your home.

As the majority investor in your home, the bank needs to know what it is worth before they are willing to lend you money to buy it.  That’s when the professional appraiser is called.  The home will be compared to properties in the neighborhood that are similar in condition, amenities, size and other aspects.  The appraiser seeks the most proximitous, most recent, most similar sales possible for the comparison.  All this information is gathered together to determine the home’s estimated market value.

The report and conclusion then get passed along to the bank.  The bank utilizes this info to help decide whether or not the real loan to value ratio is favorable or more so than the one for which you applied.  For instance, if you applied for an 80% mortgage with 20% down and the appraisal is below the sale price, the bank will only want to lend you 80% of the appraised value.  If it is too low, either the Seller will need to come down in price or the Buyer will have to come up with more money to maintain the ratio.

Who Chooses the Appraiser?

In New Jersey, there is a statutory training, examination and licensing procedure in order to qualify to perform bank appraisals.  Appraisers are further required to maintain continuing education on a schedule.

Mandated by reforms created after the housing bubble burst in 2007, the selection is anonymized.  Banks must work with an appraisal management company.  Neither you, your agent nor the bank will influence the choice of appraiser.  This helps keep the appraisal neutral instead of weighted one way or another.

The hiccup in this system is that appraisers have differing levels of acquaintance with unique and powerful location factors influencing market value in Westfield, Cranford and Mountainside.  The good news is that appraisers arrange access to the home through Realtors.  These Realtors have a chance to spotlight such factors, as well as price trends and market temperature that may help the appraiser make a more localized valuation.

Talk to your Westfield REALTOR® to learn more about how a home appraisal works for Westfield Area Buyers.

Scott Gleason, CRS at Coldwell Banker Realty – East, NJ Luxury Homes

Filed Under: Westfield NJ Real Estate Tagged With: How a Home Appraisal Works for Westfield Buyers, tips for a buying a westfield home, westfield home buyer tips, westfield real estate, what to expect from a home appraisal, why do i need a home appraisal

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Meet Scott Gleason - Westfield NJ Real Estate

Scott Gleason

Luxury Homes for Sale in Westfield, New Jersey

Coldwell Banker Realty - East

Westfield Area Luxury Homes

209 Central Avenue
Westfield, NJ 07090
908-233-5555 Office
908-698-2630 Mobile/Direct
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Scott Gleason

Coldwell Banker - East

Luxury Homes for Sale

in Westfield, New Jersey

908-233-5555 Office
908-698-2630 Mobile/Direct

Send an Email to Scott

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