Homeowner Resources

How can you enhance the value of your home? What should you expect when your home is being appraised? Where can you learn more about the FHA appraisal process?

With nearly three quarters of a century of home valuation experience, we know appraisals. Plus, regulations and standards frequently change in the appraisal industry. As an industry leader, Forsythe Appraisals stays on top of the changing landscape and provides resources to keep our clients positioned for success.

Resources to help you get the most out of your appraisal:

Appraisals 101: What To Expect.

On the surface, it may seem like an appraisal is a simple, fast process. An appraiser shows up at your house for a short time with a camera and tape measure and that’s it. However, the home visit is only a part of the appraisal process. In fact, a typical appraisal report requires 12 to 13 combined hours by appraiser and staff to complete. At Forsythe Appraisals, we follow thoughtful and thorough procedures to provide a complete and accurate appraisal.

Preliminary Information Gathering

The appraisal process usually begins with a telephone or in-person interview with you about your home as well as thorough preliminary research of recent home sales and listings in your neighborhood. In the language of appraisal, these sales and listings are referred to as ‘comps’, which is short for comparable properties.

Identifying Unique Characteristics

If the appraiser is aware in advance of any unique elements of your home, such as a finished basement or design by a historically significant architect, additional research will be done on the front end to find comparable homes exhibiting the same or similar characteristics, regardless of how far away those comparable homes may be. Our appraiser makes dollar adjustments to reflect differences in comp properties. Upgrades like fireplaces, air conditioners, recent redecorating, or home improvements can add value to a property.

The Home Visit

Then the appraiser conducts a careful physical inspection of your home. Don’t worry about the kids, toys or household disorder. We are looking at the structure, condition and features of your home.

Selecting The Comps

Having made a sketch of your home, computed its size and noted its most significant characteristics the appraiser now can select an appropriate selection of comps from the data already collected. If during the inspection the appraiser learns of something that would affect the value of your home, a return visit to the office for more research may be in order.

Verifying The Comps

You may see our appraiser driving up and down the streets of your neighborhood. We will be searching your neighborhood for homes that are similar to yours in location, size, design, number of rooms and extra features. Our appraiser drives by all possible comps for the purpose of exterior inspection, making notes on condition and location and photographing them. Returning to the office, phone calls will be made to agents and other parties involved in these transactions to confirm observations or to gather further information about the properties and/or financial aspects of the transactions. Often, property information from several sources is in conflict and it is the appraiser’s task to determine the true state of affairs by means of research, experience and good judgment.

Pulling It All Together

Next, the appraiser performs in depth analysis of all of the available data and then prepares a detailed report with several addenda including copies of parcel and neighborhood maps as well as photographs of your home and the best comps available. There will be at least three comps, but generally four or five are necessary to support the basis for the final appraised value.  Your lender may also have specific guidelines that must be followed.

  • Every effort is made to substantiate the appraiser’s opinion of market value.
  • The value conclusion is not based in any way on the personal or architectural preferences of the appraiser.
  • It is always a carefully reasoned value based on recent real estate activity of properties similar to yours. If homes like yours are selling at good values, you should have a relatively high-appraised value. If not, the market is saying something else to you.

The completed appraisal is packaged and transmitted to our client—the lender or lender’s representative who ordered the appraisal.  When you are provided with a copy of the appraisal, we highly recommend that you read it thoroughly.  If you have questions or concerns about the appraisal, you should  contact your lender and not Forsythe Appraisals directly.  Your lender will have processes in place which they are required by law to follow, for addressing your questions or concerns.

Quality Control and Review Process

During its life, which is typically three months, the appraisal report may be subjected to thorough review and examination by any one of several lenders and their staff reviewers. The purpose of the reviewer may be to uncover inflated appraised values presented for the purpose of obtaining what in their view would be dangerously high loan amounts.

  • For this period of time, your Forsythe appraiser may have to answer inquiries from several lenders about any aspect of the report. These answers may be by telephone but are usually required in writing and can be quite extensive and time consuming. But they are a necessity in the process of ensuring a truly accurate final appraisal report.
  • A concerned and well-informed appraiser can often be the difference between a perfectly good loan being granted or denied.
  • Forsythe Appraisals prides itself on its professionalism and commitment to customer service.  The time spent fielding these requests during the loan process  is as much a part and cost of doing business as the appraisal itself.

Our appraisers are friendly, courteous and interested in providing any information you may need. Ethically, we have a client relationship with your lender or lender’s representative. All of our communication must go through our clients. However, feel free to ask questions while we are in your home.  Please note that any conversations that appear to influence value may be required to be reported to your lender.

We’re ready for your next appraisal. Contact us at 651-486-9550 and let’s get started.

Guide to Home Improvements

Many appraisers decline to answer questions on the value of particular home improvements because each situation is unique and no information should be regarded as a guarantee. As a service to you, we offer our opinion on the cost effectiveness of a few of the more common improvements, as seen through the eyes of an appraiser. These are general guidelines only.

As a homeowner, you will want to make whatever changes are necessary to enhance the enjoyment of the home for you and your family, but be aware that the cost of the improvement will often not be totally recaptured in an appraisal or sale of your home.

Typically, neutral decorating (new carpet, paint, wallpaper, etc.) is money well spent. Larger improvements, such as additions and four-season porches, must be considered on a case-by-case basis. Be sure to take a look at your neighborhood when planning changes and try to keep improvements in line with other properties in the area.

The following guidelines are rough estimates based on Forsythe’s over 70 years of experience. Only a complete home appraisal can tell the value of such improvements on your particular home.

These guidelines are based on a single-family home in the median category for the community in a ‘typical’ neighborhood.

Home Improvement Guidelines

Improvement % Return
Fireplaces (zero clearance) 100%
Cosmetic changes (carpet, paint, etc.) 90-110%
Central Air 90%
Deck (10' x 12') 80%
2-Car Garage 80%
Kitchen & Bath Updates 65%
3-Season Porch 60%
Finished Basement 60%
Landscaping 50%
Main Floor Addition 50%
Permanent Storage Shed 50%
New Furnace 50%
New Roof 50%
Plumbing 50%
Electrical 50%

We’re ready for your next appraisal. Contact us at 651-486-9550 and let’s get started.

Most Common FHA Repairs

These conditions are not listed to scare you, but to help you understand and erase any worries you may have. Although the federal department of Housing and Urban Development no longer issues a required repair list, the list below is a good general guideline to things you may want/need to improve in order to make your home marketable via FHA financing.

The purpose of a repair is to correct deficiencies which may affect the health and safety of the occupants or the continued marketability of the property. If possible, we suggest that you make any repairs to your home prior to the appraisal. This will improve the marketability and help the sale or refinance of your home go smoothly.

The most common FHA repairs:

  • If the home was built prior to 1978, chipping, peeling paint must be scraped and painted. This includes interior, exterior, garages, sheds, fences, etc.
  • Roof should have 2-3 years of useful life remaining and no more than 2 layers of shingles. If the home is over 10 years old, you must remove snow from a large portion of the roof for inspection by the appraiser.
  • The cause of wet basements should be cured (e.g., improve drainage away from house, gutters, etc.).
  • Abandoned inoperable wells must be capped and sealed by a licensed well sealing contractor.
  • Infestation of any kind should be exterminated (e.g., insects, mice, bats, etc.).
  • Damaged or inoperable plumbing, electric and heating systems should be repaired. The appraiser will check these areas.
  • Structural or foundation problems must be repaired.
  • Flammable storage tanks must be removed and filler cap sealed from the inside (e.g., buried oil tank).
  • If there is a crawl space or attic, it will be the homeowner’s responsibility to make this area accessible so that it can be thoroughly inspected.

Keep in mind that these are the most common repairs. Contact your lender with specific questions regarding your property.

We’re ready for your next appraisal. Contact us at 651-486-9550 and let’s get started.

Errors & Omissions Insurance

At Forsythe Appraisals, we know how important it is for you to go about your business with confidence. As real estate transactions grow increasingly complex and the use of litigation becomes ever more common, the need for errors and omissions (E&O) insurance programs to lower the risk to companies and their associates against potential lawsuits has also risen. Forsythe Appraisals carries a comprehensive E&O policy to help all parties enjoy a worry-free experience. 

For more information, contact us at 651-486-9550.

 

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