Real Estate Appraiser – 2 Questions To Ask Bank-Sent Appraisers So You Get Your Mortgage
When you take out a mortgage or refinance one, the lender is going to want to know the value of your house, so they’re going to send out a house appraiser. Most people don’t challenge the lender’s choice of appraiser. Which is not the best way to go. Read on to find out why.
Prior to the Home Valuation Code of Conduct (HVAC, 2009), home appraisers could, and usually were, hired directly by the bank or mortgage broker who was doing your mortgage. After the Home Valuation Code of Conduct, they cannot, they must get the job done through intermediaries – AMC’s (Appraisal Management Companies). Appraisal Management Companies are in the business to make money. They make more of it when they work with appraisers who charge little. Even if those appraisers live two counties away from the property they appraise.
That’s got a lot of people complaining about appraisers who don’t live close to the properties they appraise. The issue, though, isn’t that the appraiser lives 2 counties away. The issue is that the appraisers don’t know your neighborhood and/or they can’t get the information on your neighborhood that he needs (without spending extra; and they’re not going to spend extra because they’re paid too little). There are appraisers who live a mere 3 miles from your home and who don’t know your neighborhood.
Which means, when the appraiser calls to set up a time to come to your home, you don’t ask them ‘Where’s your office?’ or ‘Where do you live?’ Instead, you ask them how often they appraise in your area. You ask what they think to be your neighborhood and why. If you know your neighborhood, you will know if you should let them appraise your home.
Then you have to find out about their work ethics. You do that by asking them if they have to see your attic and your crawl space. Because property appraisers have to get their head and shoulders inside inside crawl spaces and attics (assuming you don’t have stuff blocking the access). Yes, they are supposed to carry a ladder with them, just so they can get their heads and shoulders inside the attics of homes that don’t have ladders.
Which means, you should frame the question something like this: Do you have to get into the attic? Because my ladder broke.
‘It’s okay. I have one,’ is the answer you’re looking for.
These two question say a lot about the appraisers work ethic. If they’re not prepared to go into an attic, they’re not prepared to do a lot of other things.
So, even though it’s the bank that’s sending out the appraisers, interview them when they call to set up the appointment. If you don’t think they’re good enough, ask for another appraiser. There are a lot of mortgages that don’t happen because they’re in a neighborhood that where properties have lost value or because the owner needs too much. Then there are the mortgages that don’t happen because of the appraiser. It used to be that a lot of property appraisers over valued properties. These days, there are a lot who under value. It’s just easier and faster. You don’t want those. You want the ones who don’t over or under value.
Obviously, you also need to look up their license on your State’s website, see if they’ve ever been disciplined and why. You need to ask them for references.
If you’re not happy with the answers to the two questions, you call your mortgage broker or the loan officer you’re working with and tell them you want another appraiser, one who has better work ethic and/or knows your neighborhood. When you ask for another appraiser, you risk losing your lock. But a bad appraiser could cost you the lock too even if they did not undervalue your home – they make mistakes the bank wants corrected.
You reduce the chances of mishaps if you interview appraisers the first time they call you. Don’t miss the opportunity.
Though the information in this article is geared towards people who’re considering getting a mortgage, the information can be used every time you deal with home appraiser. You should always be thinking that since it’s your mortgage and getting or not getting it will have significant results, you should get the best one you can get. Think about it: if your house is over appraised, you end up borrowing too much, which can cost you when you want to sell. If it’s under appraised, you either don’t get the mortgage, or you pay too much in interest.
I know it’s easier to play with a <a href="”>mortgage payment calculator then interview an appraiser. But there’s a long way between whatever the current mortgage interest rates are when you’re getting ready to get your mortgage or refinance and the best mortgage for you. And good property appraisers are one of the ingredients necessary to get from one to the other. So always get a good one.
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