Skip to main content
Routing #321180379

What is an appraisal?

An appraisal is an unbiased estimate of a home’s true or fair market value. An appraisal is used to determine whether the home's purchase price is appropriate given the home's condition, location, and features. 

The appraisal process and how appraisal values are determined

In order to proceed with your mortgage loan, First Tech requires an appraisal of the property you intend to finance.  First Tech will work with a third party appraisal management company who will assign a licensed appraiser to complete the inspection and provide a valuation report.  An appraiser is a licensed individual who is familiar with the local area of the home. Federal regulations state that the appraiser must be impartial and have no direct or indirect interest in the transaction.

A home’s appraised value is influenced by recent sales of similar properties and current market trends. The home's amenities, the number of bedrooms and bathrooms, and square footage are also key factors in assessing the home's value. The appraiser must do a complete evaluation of the interior and exterior, noting any conditions that adversely affect the home’s value such as needed repairs.

Appraisers are required to take photos of the interior and exterior of the home. They will also document details of comparable sales that are used in their valuation. The report must include a street map showing the appraised home and comparable sales locations, a building sketch, explanation of how the square footage was calculated, and any other information used in determining the fair market value of the home.  

Suggested Articles

Image for why-fixed-or-adjustable-rate-mortgage Why fixed or adjustable rate mortgage (ARM)
There are plenty of good reasons to choose a fixed-rate mortgage as well as an ARM (Adjustable Rate Mortgage).
September 01, 2022
New Home
Image for What is mortgage insurance and how does it work What is mortgage insurance and how does it work?

Mortgage Insurance—also referred to as Private Mortgage Insurance or PMI—offers protection for a lender in case a mortgage payment is missed. Borrowers are typically required to pay mortgage insurance if they are making a down payment of less than 20 percent of a home’s purchase price, however it is also required for some federal loans.

June 13, 2022
Insurance
New Home
Image for Tax benefits to owning your home What are the tax benefits to owning your home?
Whether you already own your home, or you’re looking to buy or sell, there are tax benefits that may await you as a homeowner. Owning a home comes with tax deductions that can put more money back in your wallet—but many of these deductions come with limits, qualifications and requirements that should be reviewed.
April 29, 2022
Tax Planning
New Home