There’s always some feature of a house that makes the buying process deeply personal for you. Maybe it’s the walk-in closet or the dreamy bathroom, where you immediately envision yourself taking hot, relaxing baths.
So, you finally chose a house and have decided that this is the “one”. The only concern now standing in your way is the worth of the house that must be near the mortgage value. A harsh reality is that lenders see your house as collateral. For some reason, if you are unable to make the mortgage payments, there’s a possibility that the lender might foreclose or sell the home to recoup the loan.
This is why you need to make sure that your Sandy Springs home for sale is valued above the purchase price before the contract is signed. Following are some appraisal tips that will help you in buying a house:
The Home Appraiser Is the Third Party… Sort of Like Switzerland
Before the purchase agreement is signed or the lender approves your loan, an obstacle that you need to cross is an appraisal, which is done by the appraiser. The appraiser assesses the value of the house according to his findings and sides with neither the seller nor the buyer.
Be Prepared for the Appraisal Payment
While there’s no rule per say of who might pay for the appraisal, it’s usually the buyer who ends up making the payment. The fee is typically included in the closing costs. However, you can ask the seller if he is willing to cover this payment. An appraisal usually costs from $287 to $373.
An Appraisal Takes Time
The purchase agreement includes a clause that allots 14 days to the home appraisal. The appraiser visits the Sandy Springs home for sale, writes a report, which takes a week due to the busy housing market and then gives you a detailed analysis before the contract date is due.
The 3 Possibilities and How to Tackle Them
The appraisal report is provided to you and the seller, and details the methodology the appraiser used to evaluate the Sandy Springs home for sale along with comparable home sales. There are three ways this report can go:
- The Appraisal Value Matches the Purchase Price –You will get the loan immediately and can proceed to buying your house
- The Appraisal Value is Higher than the Purchase Price –Congratulations! You now have equity
- The Appraisal Value is Lower than The Purchase Price –Say, the appraisal is short in $15,000 on a $250,000 house, what are you supposed to do now? Don’t worry, there’s still time to turn this deal around in your favor
Coming Up With the Difference
So, the appraisal didn’t go as you planned. Here are your three options:
- You can negotiate with the seller and tell him to lower the purchase price in exchange of favors that he might be offering
- You can go for a re-appraisal (remember, the cost will be out of your pocket)
- You can come up with the difference from your savings account
If you feel that your dream house is slipping through your hands, negotiate with the seller. Come prepared with knowledge about the real estate market value and comparable sales. Need to get your dream house appraised? Head on over to America’s Network Reality Group Inc. and get a quick appraisal from experts.