What is the appraisal? Read this blog post to find out!
Who orders the appraisal? Your mortgage lender will order the appraisal. They will call you to get your payment information soon if they haven’t already. Generally the cost is somewhere between $500 – $750 and is considered part of your closing costs, even though you pay for it at the time it is ordered.
A few tips about the appraisal:
- You and your Realtor do not attend, only the listing agent will attend
- Once the appraisal is ordered it generally takes about a week to get it actually scheduled and another week to get the report returned.
- Once the report is written, it will be sent to your mortgage lender and they will then forward it to you. At that point you will know the appraisal value and if anything more needs to be done.
- If the property appraises at the purchase price, nothing further needs to be done and the closing process will proceed, this is most cases
- If the property appraises for less than the purchase price, we have a problem. The bank will only give you a loan based on the appraised value of the property. In this case we will go back and renegotiate the purchase price. Ideally the sellers will accept the appraisal price, if they won’t there are some decisions to be made. You will need to decide if you want to walk away or bring more cash to closing.
- For example, if the purchase price is $500K, but the appraisal only came in at $475K and the sellers won’t go any lower than $480K you have to decide if you’re going to bring an extra $5K on top of your down payment and closing costs to closing or walk away from the deal.