About the Appraisal and Valuation Process
1. What is an appraisal?
An appraisal is a professional opinion of value completed by a licensed appraiser.
2. Why do we need an appraisal?
The value of the home serves as the collateral for the loan. Investor and lender guidelines require that there is adequate value in the property when making the loan. As a buyer you also want to know you are not over paying for the home.
3. How is the appraisal ordered?
VanDyk employs separate staff who manages the ordering and payment of the appraisal services. These employees are totally independent of the production staff and use an unbiased process to ordering the appraisal.
4. Who chooses the appraiser?
VanDyk’s appraisal management team uses a round robin approach to choose the appraiser and giving him/her the assignment. By law they cannot take requests when making such assignments.
5. Can I talk with the appraiser?
The appraiser by law is not allowed to discuss the value or details of his/her report or findings but rather submits it to the lender once it’s completed.
6. Does VanDyk Mortgage employ the appraiser?
No – all the appraisers are independent contractors – VanDyk has no influence on their work.
7. What is appraiser influence?
There are a lot of Federal and State laws that prohibit lenders and the public from influencing the appraisers in anyway. We (and you) are not allowed to discuss the appraisers work prior to completion.
8. How is the home’s value determined?
The value of the home is primarily determined by the market and comparable sales and values. Most of the appraisers time is spent researching the immediate market in completing his report.
9. My appraisal is low- what now?
First discuss the value with the related parties and determine if re-negotiations are warranted. If you want to challenge the appraisal there are specific procedures that must be followed. First you have to have a legitimate reason to request a review. Such a request needs to be supported with documentation and information that the appraiser was unaware or missed. (such as new comps or sales that were not yet on MLS services) We are not allowed to simply ask for a review without supporting documentation.
10. Can I have a copy of the appraisal?
Yes- you are entitle to a copy of the appraisal.
11. Can we order a second appraisal if we don’t like the first one?
Typically by law this is not allowed unless we can show there was a material reason to order another appraisal. Just because the value is low or we disagree with the opinion is not material.
12. The appraisal has conditions – now what?
If the appraiser sees safety or health issues with the home he/she will typically list those as conditions that must be completed or repaired prior to closing of the loan. The appraiser may put other conditions that in their opinion that need to be completed prior to close that are inclusive of the final value.