In the middle of buying a home? If so, you've probably already realized that there are many steps you'll need to complete before you will officially take ownership. From scheduling inspections to going through the drawn-out closing process, there are many items that need to be checked off your list. And one thing you won't want to overlook in buying a home is completing a real estate appraisal.
The purpose of a real estate appraisal is to determine the current value of a property before a sale is finalized. Appraisals are important for several reasons. For starters, having an appraisal done ensures that the property you are looking to buy is worth at least what you have offered to pay. This is especially important if you'll be taking out a loan to pay for your home, as your lender will not want to let you borrow more than the property is realistically worth.
There's a good chance that your home insurance company will require an appraisal to determine the amount of coverage you will need for your property.
Typically, you are responsible for the cost of the appraisal as the homebuyer. Costs can vary greatly depending on where you live and other factors. However, you can generally expect a home appraisal to cost somewhere between $300 and $450. This cost is often built into your mortgage, so you may not have to actually pay anything out of your own pocket up-front.
Once your appraisal is scheduled, there isn't much you need to do. You do not need to be present for the appraisal itself; you will receive a report that tells you the estimated value of the home after the appraiser visits the property.
Ideally, the appraised value of the home will be at least what you have offered to pay for the property. And most of the time, this is the case. However, if the appraisal comes back low, you may need to head back to the negotiating table to see if the seller will drop the price of the home. Otherwise, you will need to produce the difference between what your lender will let you borrow and the agreed-upon sale price.
Kimberly Kelly decided to get her real estate license when she moved to South Orange with her family and fell in love with the classic, period homes of the area. Having worked in the city for many years for LexisNexis, Kim understands the appeal of an easy commute to NYC. That’s why she specializes in towns along the Mid-Town Direct train line, offering welcoming communities, good schools, and space to grow.
Very active in her children’s school PTA, Kim knows firsthand how important a school system is to parents looking to make the move to the ‘burbs. She volunteers with fairs, fundraising, and other activities that bolster support for education. Kim also believes involvement in the greater community enriches us all and has sat on various boards & associations throughout the years.
Kim Kelly has lived many places throughout her life, from Pennsylvania to Oregon, but has found New Jersey to be the ideal place to raise her family and put down roots. She loves nothing more than helping others discover their special place as well. Kim’s extensive knowledge of the area, combined with her sense of community, offers clients a personalized guide to finding the right house - and town - to call home.
