What You Should Know About Real Estate Appraisals

Appraisals are typically recommended when you are purchasing or selling a property. However, a lot of homeowners and potential home buyers do not really understand how the appraisal process works or what information it provides.

Lenders Often Require an Appraisal

During the transaction of a property, all involved parties will want an accurate estimate of the value of the property. The seller and buyer will often use the information provided by the appraisal to negotiate the selling price. However, if the buyer is obtaining a mortgage, it is the lender that typically requires the appraisal.

In most cases, a real estate appraisal in Ottawa is ordered by the lender and paid for by the seller. Even if the homeowner had recently received an appraisal, the lender will want an independent assessment of the property.

Appraisals and Home Inspections Are Not the Same

People often confuse home inspections and appraisals. While they do share a few similarities, the two processes are completely different. Real estate appraisers in Ottawa help determine the estimated market value of the property while home inspectors help find faults and recommended repairs.

Both inspectors and appraisers inspect the property, including any problems or noticeable damage. They will also inspect every room and the exterior of the property.

Appraisers will take the information that they gather and then review recent home sales in the area. They are looking for similar properties to make comparisons and arrive at an accurate price estimate.

Top Reasons for Getting a Real Estate Appraisal

While lenders often require an appraisal, there are additional situations where you may want a better estimate of the market value of your property. For example, a commercial appraisal in Ottawa Ontario is recommended if you plan to buy, sell, or refinance a commercial property.

Entrepreneurs may also need an appraisal when attempting to obtain a business loan. If the home is to be used as collateral, the lender may require an appraisal.

Obtaining an appraisal before refinancing your mortgage is also recommended and may be required. If your home value has increased or if you have less principal left on your mortgage, refinancing may help you gain more equity in your home.

Appraisals provide the most accurate indicator of the current market value of a property. Whether you are buying, selling, refinancing, or using your home as collateral for a loan, a detailed appraisal can be incredibly helpful and may save you money.

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