Appraising A Home For Sale In Maine, How It Works For Bank Lending. - Mooers Realty (2024)

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Yes. Nope. In that order.

Not always but if the right three sales, the best three competing listings are used, the opinion of value should come out pretty much to the same valuation conclusion.

But like the first doctor who says you need a knife in your back operation and the next one says just a life in one shoe. Opinions vary. Same with legal advice you want to take or not.

It is an opinion of value with a house appraisal, a science to arrive at today’s market value considering everything the home has or does not and what is going in the market the property lives in.

Real estate is a fixed base commodity. Tied to the rise and fall of market values in the surrounding area in the community. If a mill closes, pink slips get handed out and factory windows are boarded up, that increasing supply of housing will affect the market value. Simple economics 101 at play with supply and demand. I have seen a bank stand by the home appraiser results and the only way to move ahead is around that bank. Starting over with another one and a re-roll of the dice.

The appraiser looks for hazards, may recommend further inspections by a qualified tradesman to study the defect and suggest solutions. The corrections to whatever is wrong with a property needing bank financing have to done by someone involved in the sale. The buyer if he has the money and expertise is the first stop.

The seller can get step up to the plate and agreed to fix the missing deck railing. Or slide in some new steps to the back door to replace the rotten ones that are a hazard. But if no one agrees to do the repairs that the appraiser doubles back to sign off on their completion, the home sale can stall, derail. Unless another financing method with in house portfolio lending at a higher interest rate and more severe terms are agreed to by the buyer making the home payments.

My Dad was a licensed Maine real estate appraiser.

He loved going on the mission of another house valuation and to compare this home for sale to another that had sold. The last six months to a year is where the comps house sales come from and if they are too old, adjustments for time have to be made if the lender will allow. If what is used for a sold and competing three to six homes are so different that too many adjustments are being made, that can blow up in the mortgage underwriting. In small rural housing markets, you don’t have three hundred lot subdivisions to create plenty of both sold and listing inventory to use in the comparison.

The rural house appraiser has a more difficult task to find comps than his counterpart in the urban city settings.

The fee for the house appraisal is lower too and lots of the comp sales for houses are hard fought for in the tiny towns.

With very small hit or miss municipal offices only open so many hours or days a week.

Inter family sales and anything not arms length for a transaction can’t be used as quality house transfers in the appraisal exercise.

If special owner financing terms were involved, or concession made that the sale price does not reflect, the appraiser makes lots of calls to uncovered the details of the transfer. Repossession, short sales, pressure to sell quickly because of that third tax bill lien that could cause the seller to lose the home are factors that sway the value and need to be examined closely.

Fair arms length house sales without lots of personal property included in the inflated price and retained possession or use of part of the premises all affect the market value and why the home sold for what it did.

Fair market value of a home is what you could reasonably expect in today’s market to receive. If the house is placed on the open market, exposed to the current inventory of buyers and there is adequate time to showcase the features to locate the ready, willing and able buyer that ends up in the property. Curb appeal for a home increases when the supply of musical homes dwindles. To set your family down inside for the three meals and head to bed, rise and shine.

Appraising a home, my advice is to obtain local lending because you want to do business that helps the area economy. The turn around service time is faster and the lender knows the local market.