May 4, 2016

One of the most commonly asked questions we get from our clients is about the appraisal.

Who pays for it? How much does it cost? When in the mortgage process is the appraisal paid? Is an inspection still needed?

The appraisal is paid for by the borrower and on the average, the out of pocket expense for a single family residence is $525.

Determining the value of the property is necessary in order to find out if the home you want is over-priced and the financing available after the appraisal comes in.

The appraised value is an opinion of a property’s fair market value, based on an appraiser’s knowledge, experience, and analysis of the property.

No one wants surprises at a closing. We order the appraisal early in the loan process and inform you the moment it is received.

The appraisal is one of the lengthiest parts of the mortgage loan process. Studies have shown that the single biggest factor in appraisal “lag time” is the appraiser’s inability to reach the homeowner to make an appointment. If you’re refinancing and the appraiser calls to make an appointment, make it as soon as convenient for both of you.

It is NOT the same as a home inspection. An appraiser merely forms an opinion about the property value. An inspector will help identify current and future problems.

Remember that the appraiser doesn’t want to buy your house. He or she will say what the house is worth the same if it’s tidy or if you have some clothes on the laundry room floor or dirty dishes in the sink. Cleaning doesn’t get you a higher appraisal! Letting the appraiser in as soon as possible however, does move your loan along faster.

Some lenders need to be called and reminded during this point in the process. This is unacceptable to us and we always stay on top of each step so you don’t have to worry!

Still have questions? Give us a call! 303-800-4595



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Sierra Pacific Mortgage Company, Inc.

Sierra Pacific Mortgage NMLS# 1788. Michael Shotnik NMLS: 218281, CO License: 100017466. Regulated in Colorado by the Division of Real Estate #988320. To check license status of mortgage loan originator, visit D.O.R.A. and NMLS consumer access.