So, you have decided to purchase a new home, or you are going to take advantage of these great low interest rates and refinance your current home mortgage. What do you expect will happen when your lender says that you need an appraisal? Typically, the appraisal process will proceed as follows:

First, your lending institution will contract with an appraiser on their approved appraiser list. The most competent appraiser will be state certified and very familiar with the market in your area. For instance, I appraise only in St. Tammany Parish in Louisiana as I believe this geographic area is small enough that I can remain current with its market, yet large enough to expect continued growth in the area. The appraiser will then call you to schedule an appointment to come out and see your home. Please keep in mind that the appraiser needs sufficient time to completely observe all of the features of your home. I typically need at least a half hour for a 1,000 SqFt residence, while a 5,000 SqFt home may require 2 or more hours to fully review carefully.

Next, the appraiser will arrive at the scheduled day and time. She will measure the exterior of the residence while taking complete notes and photos of all exterior features. An appraisal report requires a front, rear, and street view of the exterior of your home as well as any additional improvements, including pools, workshops, guesthouses, cabanas, etc. I also try to walk the perimeter of the property to familiarize myself with your homesite.

When the exterior is complete, the appraiser will need to enter your residence and review the interior. I always draw a complete floorplan which depicts the room layout. I will also spend time noting ceiling heights and jotting down any additional features such as presence of crown molding, ceiling fans, window trim, etc. Please let me know if you have any recent updates or renovations including additions, new appliances, even fresh paint. I do not want to omit any features of your residence which may add value to your home! As I walk through the interior of your home, notice that I am also taking interior photos of most rooms. Recent FNMA guidelines stipulate that interior photos are now required for all conventional appraisals and must include a minimum of all baths, the kitchen, and main living area. Many of my lender clients also request photos of all bedrooms, dining areas and other major rooms. Recent updates, renovations, and any evidence of physical deterioration also require photos.

When the appraiser visit is complete, the appraiser will take all of the information derived from the visit and work on the appraisal report requested by the lending institution. Depending on the use of the report, the lender may request different FNMA forms in the report. The appraiser will then review sales and listings in MLS records to determine which are most comparable to your home and make adjustments to these properties to complete a sales comparison analysis. The lender expects the appraiser to find the most similar recent sales in as close proximity to your home as possible. Keep in mind that there may not be any recent sales exactly like your home and those sales used may require a number of adjustments. Even within subdivisions, properties can vary widely in lot size and residence size, age, and condition.

Lastly, the appraiser will complete her report which typically includes photos of all comparables and location maps. In today's electronic age, lenders usually request an email of the report which helps to expedite your loan process as quickly as possible. The appraisal of your home is considered strictly confidential and no information is given out by me to anyone other than your lender (this includes the tax assessor!). Unfortunately, this also means that I cannot release a copy of the appraisal to you, even though this is your home. Please request a copy of the appraisal report from your lender - I believe everyone should have a copy for their records - and I welcome any questions you may have about my appraisal of your home!