You’ve found your dream home at the Jersey Shore. Now it’s time to cross all your T’s and dot all your I’s before it becomes all your own. And one of the first items on your closing checklist you need to tackle is the home appraisal. But what exactly is that?
Your Guide to a Jersey Shore Home Appraisal
The home appraisal is essentially a value assessment of the home and property. The lender hires a certified third party to conduct the appraisal. From this, lenders determine whether the home is priced appropriately.
What Happens During the Appraisal?
The appraiser conducts a complete visual inspection of the interior and exterior of the Jersey Shore home. He or she factors in a variety of things, including the home’s floor plan functionality, condition, location, school district, fixtures, lot size, and more. An upward adjustment is generally made if the home has a deck, a view, or a large yard. The appraiser also compares the home to several similar homes that were sold within the last 30 to 60 days in the area.
What is Included in the Appraisal Report?
The final report must include a street map showing the property and the ones compared. It also includes photographs of the interior and exterior as well as an explanation of how the square footage was calculated. Finally, the appraiser provides market sales data, public land records, and any other information they utilized to come to their appraised value.
How is the Appraisal Used by the Lender?
After it is complete, the lender uses the information found to ensure that the property is worth the amount they are investing. This is a safeguard for the lender as the home acts as collateral for the mortgage. If the buyer defaults on the mortgage and goes into foreclosure, the lender generally sells the home to recover the money borrowed. A lender only approves a loan up to its appraised value…and not a penny more. If the appraisal came in below the agreed sale price, you have a few options you may use, including walking away from the deal. Talk to your REALLTOR® to determine which option works best for you.
Sherri Lilienfeld, Apex Prime Realty, Your Source for Jersey Shore Real Estate