If you’re planning on obtaining a mortgage at Lake of the Ozarks, or even refinancing an existing one, chances are you’ll be required to obtain an appraisal during the mortgage process. An appraisal provides you and your lender with the market value of the subject property and allows for confident buying and lending of real estate. In this week’s blog, I am going to be discussing the importance of appraisals in the mortgage process and how you can get the most out of yours.
Why are Appraisals Important for Mortgages?
Appraisals have a great deal of impact on acquiring or refinancing mortgage loans, as the market value of the home will dictate the amount of financing a borrower can receive. It’s about protecting the investment of the lender; if the value of the home is lower than the sales price, and the buyer defaults on the mortgage, the lender will not be able to sell the property for enough to cover the loan.
Steps you can Take to Get the Most out of Your Home’s Appraisal
Since your appraisal will play such an integral role in your mortgage process, it’s essential that you do all you can to help bolster the value that it will bring in. Here are a few tips to help uphold the value of your home:
Ensure your Appraiser is Local and Knows the Neighborhood
A local appraiser will have a better understanding of the value of your home because they know the area intimately. This will provide you with a more accurate representation of the value your home will bring in, as opposed to someone that isn’t familiar with the neighborhood.
Provide Your Own Comparable Sales Data as Supporting Documentation
Appraisals strongly consider comparable sales in the area when determining value. So, doing your homework on recent sales in your area of homes that are similar to yours can be a good way to support the value of your home.
Understand Which Upgrades Provide the Most Return on Investment
Certain upgrades to your home will provide more “bang for your buck,” so to speak. If you’re considering some minor renovations before the appraisal, start with your kitchens and bathrooms as the upgrades are typically smaller in price and have a greater return of value per dollar. Real wood floors, quality landscaping, and an enclosed garage can also boost value.
Keep Documentation of Your Upgrades & Additions
When making any renovations or upgrades to your home, always save your receipts, invoices, etc. This gives you documentation to prove the actual cost of your upgrades, as well as their timelines. Even for things such as structural improvements to heating, cooling, and electrical systems can help support appraisal value.
Ensure Your Home is Clean for the Appraiser
This one is a no brainer, but it’s always best practice to ensure that your home is clean for the appraiser. Clear the clutter, maintenance the landscape, touch of paint, etc. All of these items will help with making the home feel larger and well maintained for your appraiser.
As you can see, an appraisal plays an important part in the mortgage process. So, when you’re looking to buy a home or refinance your mortgage at Lake of the Ozarks, you’ll want to do all you can to help support the highest value possible for your appraisal. As the best mortgage lender at Lake of the Ozarks, I take great pride in assisting my clients with their mortgage needs. While giving valuable experience and advice to help them make the most of their investment. If you’re in need of mortgage assistance at Lake of the Ozarks, I encourage you to reach out.