What Happens During Appraisal Inspections?

Whether you are getting an appraisal on your home for a mortgage or purchase or potentially for pre-marketing purposes, it can be daunting in terms of wondering what will be uncovered during the inspection. All appraisers are different when it comes to approaching their inspections, however, commonly measurements and photos are taken on the exterior first, then more photos and layout completion afterwards. Most often, a typical residential appraisal inspection will take 20-40 minutes onsite. This inspection is non-intrusive in most instances (visual based) as a basis for comparison is being established as most residential appraisals rely heavily on the Sales Comparison Approach. Items to remember during your inspection: 

1. It is helpful to provide appraiser with a list of recent improvements made to home

2. The inspection is the first step of the appraisal process and is the fact finding stage of the process therefore appraiser will not have an idea of value at inspection

3. Access to all rooms will be necessary and all units if property is multi-family

4. Provide information regarding additions, permits, etc to appraiser if available

5. If you are refinancing or purchasing and purpose of loan is for a mortgage, please remember CA Law now requires Carbon Monoxide Detectors and Water Heater Double Strapping and your lender may require these items to be confirmed by appraiser. If not installed, an additional trip fee will likely be required by your lender.
 

Appraiser will be viewing overall condition and maintenance of home also as a basis for comparison to recent comparable sales. It is important, as mentioned above, to highlight and advise appraiser of recent renovations and improvements. These items include, but are not limited to: windows, flooring, roof, HVAC, pools, outbuildings, garages, drywall, paint, and energy efficient items.

Once the inspection is complete, the appraiser will then tour potential comparable sales in the market area to view and photograph. Typically, these sales are within 6-12 months and generally proximate to the subject (your) property and similar in terms of living area, vintage, and condition. Appraiser will also consider external influences and research market for reaction, in terms of value, for the beneficial (view) or negative external factor (traffic/commercial property influences).

The final stage in the process is development and reporting of the appraisal. There are various forms in which an appraisal can be reported: verbal, narrative, standardized form (Fannie Mae/Freddie Mac). Also, if you are originating a new loan for VA or FHA, access to crawl space and attic area will likely be required. 

Of course if you have any questions regarding the process, please feel free to contact us and we will be happy to assist you.