When you use a mortgage to purchase a home your lender is going to require an appraisal. An appraisal is when a professional appraiser estimates the value of the home. It’s the appraiser’s job to make sure the home is at least worth the value of the loan. Lenders want to know that they can get their money back in the event of borrower default. The good news is that Henderson home appraisals are very similar to appraisals performed throughout the country.
Here’s the scoop: lenders requires the appraisal, but buyers have to pay for it. How much will it cost you? Numerous factors will cause the amount to vary, but a safe assumption is around $300-$500.
Yes this is another costly expense. But think of it as the price you have to pay in order to learn the home’s true value. When you discover the home’s value is greater than your cost, that’s great! This means your home has equity built-in. Equity meaning the difference between a home’s market value and what you owe.
Conversely, when appraised value is lower than your cost, you’re in trouble. Your lender is not going to finance a home whose cost is greater than its appraised value. Lenders don’t do this because they can’t get their money back if a borrower defaults.
All is not lost, however. A way around this is to pay out of pocket the difference of the appraisal value. You could even try to renegotiate the price with the seller.
More information about Henderson real estate can be found by speaking with a member of Gore Group Realty.