Category Archives: real estate appraisal

What to remember when considering an HOA property

With a homeowner association, people tend to over look the fact that a lot of home maintenance issues are not their problem, in most cases. The HOA is often responsible for all the big items that single family home owners fret about: the roof, foundation, outside of the home, landscaping.

The drawback is that you pay a monthly fee. If you consider how much they take off your hands in terms of responsibility, the fee is a good thing. Another possible drawback is that you will be involved with the HOA to review projects and plans and vote on decisions.

Buyers should review with their agents the reserves in the building as well as the projections for when major systems will need replacement. In conjunction with this, buyers should read all past meetings to see what’s being discussed in the HOA and how they handle issues. Is it a smooth-running HOA or are there issues?

Another item to review is their policies on rentals. These policies are subject to change, and if you plan on renting the place out while you go on a long trip, that may not be possible.

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Defining home equity

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.

Market Value

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 for your home value questions.

Outstanding Debt

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.

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Appraisal Delays are gumming up home loans

Your lender does not have to use a management company (AMC) to order an appraisal.  Contact the appraisers at 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.

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