COMMON QUESTIONS

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An appraisal is an unbiased opinion of the value of any given real estate. It assumes that the buyer and seller are both reasonably informed and not acting under duress. To be an informed party, most people turn to a professional appraiser to provide them with an accurate estimate of the value of their property.

Since the purchase of real property is a complex financial transaction involving several parties and many documents, each of the professionals involved play an important roll.

Most of the people involved are very familiar. The real estate agent is the most common face of the transaction. The mortgage company provides the financial capital necessary to fund the transaction. The title company ensures that all aspects of the transaction are completed and that a clear title passes from the seller to the buyer.

So who makes sure the value of the property is in line with the amount being paid? There are too many people exposed in the real estate process to let such a transaction proceed without ensuring that the value of the property is commensurate with the amount being paid.

This is where the appraiser comes in. An appraiser is legally bound to provide a credible, unbiased estimate of what a buyer might expect to pay or a seller receive for a parcel of real estate. A professional appraisal is an important safeguard for such a large investment.

So what goes into a real estate appraisal?

The first thing an appraiser needs to do is determine the Scope of Work for any appraisal assignment. Scope of Work is a term appraisers use to define all of the important aspects of a given appraisal. The details include many things and vary from assignment to assignment, but always include certain features and data, such as: who is the client, what is the purpose of the appraisal, what will the effective date of the appraisal be, when does the appraisal need to be completed, and many other parameters. When you start working with an appraiser expect have a discussion on your needs and the details of the property you want appraised. This process will allow the appraiser to serve you best.

The next step in most appraisals is the scheduling and completion of an inspection of the property being appraised. An appraiser is legally responsible for the credibility of any appraisal they produce. A properly conducted inspection will allow the appraiser to ascertain the features and status of the subject property, which is an important cornerstone of a credible appraisal that will accurately reflect the subject’s value.

Once the Scope of Work and the inspection have been completed. The appraiser will determine the which approaches to value are most appropriate and discuss those with you. It is important for you to actively engage with your appraiser on anything that you feel is important and that emerging details of the assignment are taken into account as they come up so that any adjustment to the Scope of Work may be made prior to the completion of the appraisal report.

At Varnum Appraisal Services, we work hard to make sure our clients are included in the process from start to finish, so that the appraisal is not only accurate and professional, but meets their needs.