Appraisal Process

 

INITIATION

The process begins with an order from your lending institution. The assignment may be given to an Appraisal Management Company, or the lender may have a panel of appraiser they utilize for in-house loans.

 

Appraisal Management Companies, also referred to as AMC's, were a direct result of the Great Recession that occurred between 2007 and 2009.  The Dodd-Frank Act of 2010 created provisions to guard against bad policies that were the cause of the recession, and the creation of AMC's was among those new policies. The addition of a third party, AMC, was to deter lender pressure on appraisers that may influence the market value opinion of the property. Additionally, there is no direct communication between the appraiser and lender, the AMC determines what is within the new regulations to communicate.

 

INSPECTION

The inspection involves the appraiser measuring and taking exterior photos of the home, garage, and outbuildings. (Interior photos of garage and outbuildings are also required.) The exterior of the home is measured, and the measurements are used to calculate the gross living area of the home. Each interior room of the home is photographed, and a sketch of the layout is drawn. The materials used in construction of the home are recorded. 

 

Lenders want a list of improvements in the report that have been made in the last 15 years. A list can be provided to me on the date of inspection or sent to my email address.

 

PREPARRING FOR INSPECTION

Areas that are partially painted or have incomplete construction should be finished by the date of the inspection. Each incomplete area deducts from the market value and an estimate of the cost to cure, complete the item, is added to the report.  These repairs are referred to as Deferred Maintenance and are repairs that a new homeowner would want to make immediately upon purchase. For example, an incomplete bathroom will result in one less bathroom recorded for your home. Tighten up handrails and inspect your home for areas that may be considered hazardous or a safety issue. If you have questions, please contact me for clarification.

 

During the inspection, I overlook the cleanliness and disarray of your home. However, taking some time to improve the appearance will allow more time to inspect and note the areas of your home that make it superior to a comparable property.

 

An additional requirement for FHA financing is to inspect the attic and all crawl spaces. Be sure to have these areas accessible on the date of inspection.

 

I look forward to meeting you and please contact me with any questions you may have prior to inspection.

 

Barbara Anne Briggs

Lead Certified Residential Appraiser

             

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