When you sell your home; Why is an appraisal important??

 An appraisal is done by an appraiser who is an independent third-party contracted to establish the property’s value. This gives the seller or buyer, a report on the condition of the property and its fair value. Most appraisals are done by buyers when purchasing a home by a loan. For the seller -Appraisal is important because if the appraisal is lower than the price buyer and seller agreed upon, several things can happen;

A. The seller must agree to reduce the price.

B. The mortgage company will not do the loan because the home appraised for less.  

C. The buyer must bring more money to cover low appraisal.(Appraisal gap coverage)

D. Buyer can simply walk away. 

Low appraisal does not mean the deal is dead. It can mean buyer or seller making adjustments. So, here are things a seller can do to avoid leaving money on the table .

1. If you get a low appraisal, you can request another appraisal and check for errors in the report. May be the appraiser missed a bath or perhaps you forgot to report that all windows had been replaced.

2. Your realtor should provide the appraiser with a prepared appraisal packet that includes homes comparable to your home in size and condition.

3. Make a list of updates and upgrades on the home over the years. Include invoices, permits and especially for large ticket items; Roof, HVAC, kitchen update, bath updates.

4. Organize, Paint, Clean inside and outside so the home shows well.

Home appraisal is necessary because the lender wants to know what the property is worth. They don’t want to be stuck with a property worth far less than the loan and neither does a buyer. You as a seller need to prepare so you do not leave money on the table.