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All About Appraisal
Home Loan Lingo

All about the Appraisal

You’ve probably heard of appraisals before. You have them once a year to determine the amount of property tax you pay. You have to have one conducted in order to be approved for a home loan or home equity credit. You know it’s important, you know you have to do it, but do you know exactly what it is and what it means?

An appraisal is an assessment of your home that determines its value in the current market. Your home may have been priced lower or higher when you purchased the home, but as the real estate market fluctuates, so does the value of your home.

For tax purposes, this means you want the value of your home to be lower. For taxes, your house must be assessed for its tax-value. The tax-assessed value is a type of appraisal different than a normal appraisal, or appraised value. The tax-assessed value will tell you how much property tax you will pay each year.

For loan purposes, you want the value of your home to be as high as possible, since what they want to know is that your home is worth investing in. If your home is not as valuable as the loan they are giving you, there is no collateral for them. They have nothing in which to put their trust.

Countrywide Home Loans wants to help you earn your home loan and home equity line of credit. They want to consolidate your debt and not charge you more interest than is necessary. This is why Countrywide only requests the appraised value of your home when you apply for a loan.

Appraisals are professionals who are trained and experienced in estimating the value of real and personal property. They are familiar with the real estate market and the fluctuation of value within that market. The fee varies between appraisers and the geographical location in which you have the appraisal performed.

The home’s value is appraised on several bases. First, the appraiser looks at the general condition of the house. This person will also look at the size of the house and/or property, location of the home including neighborhood and view, features of the home such as number of beds and baths, major structural improvements or renovations that have been made, highly popular architectural features like skylights and/or fireplaces and the prices of other properties in the area that are similar to yours. The last factor may be the most important, as your home will not sell for a drastically higher amount if it is the same as your neighbor Bob’s home.

Appraisals should not make you nervous. Although they may come at high pressured times, approaching tax season or upon selling your home, the appraisers are there to help you. They are not out to rob you (why would they be?) and even if the appraisal is not as you desired or suspected, come talk to Countrywide and you will be given personal service that helps you in your quest to sell your home or obtain that loan you’ve been wanting. At Countrywide, your future outweighs your past.

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