A home purchase is the largest, single investment you will probably ever make
Whether it’s a primary residence, a second vacation home or an investment, the purchase of a property is a complex financial transaction that requires multiple parties to pull it all off.
ost of the people involved are very familiar. The realtor is the most common face of the transaction. The mortgage company provides the financial capital necessary to fund the transaction. The title company ensures that all aspects of the transaction are completed and that a clear title passes from the seller to the buyer.
So who makes sure the value of the property is in line with the amount being paid?
There are too many people exposed in the real estate process to let such a transaction proceed without ensuring that the value of the property is commensurate with the amount being paid. Don’t hesitate to provide the appraiser with any information or records that might facilitate the appraisal process and lead to a proper value conclusion.
Relevant factual data includes:
- It can be sold and the proceeds divided
- One party can “buy out” the other
- A plat plan or survey of the house and land
- Your property deed, which contains a legal description of the property.
- Your most recent real estate tax bill
- Your mortgage, showing the type, terms, and whether or not it is assumable.
- A factual record of recent sales and listings in the neighborhood, which can be verified by the appraiser.
- Your title policy describing encroachments.
- A list of personal property to be sold with the house.
- A ‘brag’ sheet listing major home improvements and upgrades, the date of their installation, and their cost.
Professional standards of practice prohibit appraisers from discussing the details of the appraisal assignment with you if the appraisal was requested by your employer or the relocation management company. Nevertheless, appraisers can tell you what they generally look for and how different property characteristics will be weighted in the analysis. You may want to ask some questions about the appraisal process.