Have some knowledge to share, and want easy and effective exposure to our audience? Get your articles or guides featured on Illinois Homes today! Learn more about being an expert contributor.Learn More
For many years Appraisers inhabited a small corner of the Real Estate industry landscape that was misunderstood by some and totally confused by others. Appraisers fill a critical role as impartial evaluator of a homes true market value. Since unlike stocks or mutual funds a house is a different kind of investment with a subjective valuation, specialized appraiser's are needed . Perhaps foreseeing the current housing market conditions Freddie Mac and Fannie Mae adopted a code last year to separate loan officers and brokers from the direct hiring of appraisers since there could be a conflict of interest for the Federal Housing Authority (FHA) and the major federal lenders who still control nine out of ten loans. The assumption is that appraisals are much fairer now and closer to determining the fair value of a home.
Appraisers are almost always certified or licensed. The certification seems to be a bit more stringent a process since it is more intensive in training and requirements. The licensees to have to pass a state exam. Knowing the difference is important because it means if you have an issue with a professional he or she is held up to a higher standard (Code of Professional Appraisal Practice of the Appraisal Institute) and consequences for failing to comply. Appraisers are now often hired by third party management companies, adding yet another layer of red tape. Always check a person's credentials out and decide which one is right for you.
Nine times out of ten we trust the word of our friends over a random web search or an advertisement. Ask your friends, neighbors or amongst your professional networks for local referrals. This serves tow functions: you will get someone with build in cred and two you want someone who knows your area really well. An appraiser from out of your area who doesn't have a feel for the pulse of the current local values is of no use to you.
A good appraiser will let you observe him or her then entire time of the appraisal. As long as you do not interfere with their basic duties they should have no problem allowing this. A good appraiser will walk you through his explanation of each point he is making to come to a conclusion. By law you will receive the final documents with the results and can ask your professional to explain for their findings. No appraiser should be trying to whiz through your home trying to break a land-speed record.
All appraisals should sound neutral and objective up to a certain point. A basic appraisal must have a detailed account of the property and a comparison of three similar ones. It should come with an assessment of the local real estate market conditions. Pros and cons the property and the outside area with regard to value. Notations about the overall structure the house. The appraiser's estimate on the average time to sell and a statement about the area the home is in generally. A top level assessment has considerations for neighborhood demographics, suggestions of improvements to the inside and outside of the home (usually a value killer) and a detailed review of the inside and outside of the home.
A professional appraiser will charge between $300-$500 for a residential property and often double or triple that for a commercial one. For this fee they are paid for a blend of their expert judgment and personal opinion based on experience. Often the Appraiser's valuation of your home is much higher than a tax assessors' price. They should come within $5000 of each other or your appraiser is way off the mark and you should get your money back.