Broken Appraisal System: Real Estate Market Flaws
How the appraisal system works:
When a lender needs to call upon an appraiser, he/she submits their request to the AMC, Appraisal Management Company. The AMC then finds an appraiser for the job. So what does this system allow to happen within the real estate market? The appraiser assigned is not picked by merit, accuracy, work ability, or anything like that. They are simply the next in line. As Realtor’s we can get mad and fight our way through the system of business we belong to, but we cannot let our clients see this. Instead, know that when it comes to appraisals, there are many factors that are out of your hands. Focus on what you can take care of and do that to the best of your abilities.
Here are some tips to give your client:
- Clean Up: Overgrown landscaping, soiled carpet, and other bigger-than-day-to-day messes may damage the appraisal. Keep the pets out of the way of the appraiser, trim your trees, and showcase the home you have!
- Up-Date: Sketching a plan of the house with sqft helps the appraiser get a feel of the space and if on that paper you attach a list of all the updating you have done on the home, even the little things count. Re-sealed a bathtub…ect
- Comps: Have some comps on hand. Being aware of nearby comparables allows you to know about where the appraisal should end up.
- $500 Rule: Appraisers work in $500 increments so if there is a repair from more than that amount; it will count against the property. MORE