April 25, 2014
Common Myths about Appraisals
From an article in RIS Media by David Bunton, President of the Appraisal Foundation
Myth: An appraiser is hired by the borrower.
Fact: Appraisers are hired by the lender to provide an analysis of the collateral. Buyers are responsible for the cost of the appraisal.
Myth: The money put into a home translates dollar for dollar into a higher appraisal.
Fact: The cost of home improvement may or may not add value and don’t necessarily correlate to the cost.
Myth: Appraisers set the value of the home.
Fact: They neither set the value nor confirm a home’s sale price. They provide an opinion of value that reflects the current market.
Myth: Appraisers and Home Inspectors perform the same function.
Fact: An appraiser provides an objective, unbiased analysis so the lender understands the value of the property. An inspector hired by the borrower performs an objective visual examination of the physical structure and systems to ensure the structural integrity.