Common myths about appraising

It is enforced by legal agencies that an appraiser needs to be state-licensed to perform appraisals for federally-related real estate purchases in Tennessee. The law entitles you to acquire a copy of your completed appraisal from your lender after it has been provided. Contact Furr Appraisal Service if you have any questions about the appraisal process.

Myth: Market value should be the same as the assessed value of the property.

Fact: It might be that Tennessee, like most states, supports the suggestion that the assessed value is the same as the market value; however, this is not always true. Sometimes when interior remodeling has been done and the assessor is unaware of the improvement or other homes in the area have not been reassessed for years or more, it may vary wildly.

Myth: The buyer or the seller often will have impact in the cost of the property depending upon for whom the appraiser is working.

Fact: There is no vested interest on the part of the appraiser in the outcome of the analysis, therefore he will conduct his work with impartiality and independence, regardless for whom the appraisal is created.

Myth: Any time market value is established, it should be the same as the replacement cost of the property.

Fact: Without any influence from any different parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a particular property. If the property were reconstructed, the dollar amount necessary to do so would make up the replacement cost.

Myth: Specific formulae, such as the price per square foot, are the methods appraisers use to ascertain the price of a property.

Fact: An appraisal is an amalgamation of information concluded from the house's size, location, proximity to certain facilities, the condition of the home and the price of recent comparable sales. You can count on Furr Appraisal Service's appraisers to be professional in assessing this data.

Myth: In a robust economy - when the prices of homes in a given neighborhood are found to be increasing by a particular percentage - the costs of individual properties in the proximity can be expected to rise by that same percentage.

Fact: Worth increase of a specific home must be determined on an individualized basis, factoring in data on comparable homes and other relevant elements. It doesn't matter if the economy is doing well or declining.

Myth: The house's outside is determinate of the actual price of the home; it is unnecessary to do an interior appraisal.

Fact: To find an accurate price beyond all doubt, an appraiser must examine the house on a variety of factors based on area, condition, improvements, amenities, and market trends. An exterior inspection definitely can't provide all of the information needed.

Myth: Since you're the one funding for the appraisal report when applying for the loan to buy or refinance real estate, you own the produced appraisal.

Fact: Legally, the report is owned by the lending agency unless the lender releases their interest in the appraisal. However, home buyers must be provided with a copy of the appraisal report upon written request, through the Equal Credit Opportunity Act.

Myth: There's no reason for home buyers to even care about what the report contains so long as their lender is satisfied.

Fact: A home buyer should definitely look through their appraisal; there may be some questions or some worries about the accuracy of the appraisal report that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the report makes a valuable record for future reference, filled with useful and often-revealing data - including the legal and physical description of the property, square footage measurements, list of comparable properties in the neighborhood, neighborhood description and a narrative of current real-estate activity and/or market trends in the proximity.