Home equity is an important source of wealth for homeowners. According to a study by the Federal Home Loan Mortgage Corporation (Freddie Mac), access to home equity contributes to the purchasing power of homeowners. The study also suggests that home equity has a larger impact on consumer spending than wealth derived from stock equity.
Home equity derives in part from the market value of your home. The basic market value of your home is based on the price a buyer is willing to pay and the price a seller is willing accept. Market value is influenced by prevailing economic conditions, the supply and demand for housing and the cost of mortgage loan funds. To account for the effects of all these factors on market value, compare your home to the sale price of similar homes in your neighborhood. Contact the appraisers at www.scappraisals.com for your home value questions.
The market value of your home is compared against the outstanding debt on your mortgage. The outstanding debt on your home is based on the principal of your loan. The principal is the amount you borrowed to finance the purchase of your home. Your monthly mortgage payments pay down the principal and pay your lender interest.
read more at: http://homeguides.sfgate.com/define-home-equity-9228.html
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Your lender does not have to use a management company (AMC) to order an appraisal. Contact the appraisers at www.scappraisals.com with your appraisal questions.
There’s trouble brewing in appraiserville — and it’s beginning to cost some unsuspecting homebuyers money. If you’re planning to buy in the coming months, be aware.
The problem is part work overload, part resentment over fees. In many markets, diminishing numbers of experienced appraisers are available — or willing — to handle requests for their work on tight timetables and at fees that are sometimes lower than they earned a decade or more ago.
The net result: The system is getting gummed up. Scheduled home sale settlements are being delayed because banks and appraisal management companies can’t find appraisers who’ll do valuations on timetables needed for closing dates in realty contracts. A recent survey of agents by the National Association of Realtors found that appraisal problems were connected with 27 percent of delayed home sale closings, up from 16 percent earlier this year.
In some cases, panicked lenders and management companies are offering appraisers fat bonuses and “rush fees” just to complete valuations to meet deadlines. The extra charges can range anywhere from $200 to $1,000 or more, turning $500 appraisals into $1,200 or $1,500 expenses that typically get paid by homebuyers.
Take this example from a mortgage broker in the Seattle area. Matt Culp, owner of Bainbridge Lending Group, says clients who urgently needed to close on a newly built house — and to move out of their rented dwelling — were squeezed into paying $2,000 for an appraisal that normally would cost $625.
read more at: http://www.chicagotribune.com/classified/realestate/ct-re-0918-kenneth-harney-column-20160913-story.html