Buying a Starter Home

Selling Your Home: Myths And Facts About The Home Appraisal

8 May 2017

Capucine Leroux

A home appraisal is necessary for selling a home to a buyer who is using a home loan to complete the purchase. If the home appraisal goes wrong, you could lose out on possibly selling your home for the desired price. Before placing your home on the market, it is important that you know the difference between reality and myth when it comes to the appraisal.  

You Are Stuck With the Appraised Value of Your Home 

After the appraisal is complete, the appraiser will give his or her opinion regarding the value of your home. If the difference between the appraised value and your listing price is a lot, the buyer's lender could refuse to finance the purchase of the home. As a result, you could miss out on the sale if the buyer is not willing to make up the difference or you do not lower your listing price.  

There is a third option though. You and the buyer can ask for a new appraisal. The appraisal is not set in stone and the buyer has a right to request a second opinion. You or the buyer will have to foot the cost for the new appraisal, but it can be worth it if you get an estimated value that is far more accurate.

Before the second appraisal, talk to your real estate agent about what can impact the appraisal. For instance, if the first appraiser did not take into account the quality of your neighborhood, you and your agent could point this out to him or her during the next one so a more accurate appraisal is completed.  

A Home Inspection Is Not Necessary If an Appraisal Is Done 

Some sellers mistakenly believe that the appraisal is equivalent to the home inspection. However, there are major differences in the home inspection and both will require some preparations on your part to ensure your home gets the best results from the appraiser and the home inspector.  

The appraisal is designed to protect the lender's investment in the home. The lender uses the appraised value to determine if the home is worth funding the purchase. By contrast, the home inspection is designed to protect the buyer's interest in the home. The inspection will let the buyer know if there are major issues with the home before the purchase is complete.  

Preparing for the appraisal means researching and printing out information on comparable real estate deals in your area. It also means being prepared to highlight the amenities that add value to your home. Your agent can help you with further preparing for the appraisal. 

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