Mortgage appraisals … no matter how much a buyer loves a house and feels confident in their selection, the mortgage appraisal process often creates that moment of anticipation and concern while waiting for those important results. Will the appraisal confirm the offer amount? Will the buyer have to bring additional money to the closing table? Will everything work out as the buyer hopes?
As a whole, the real estate market is improving throughout the U.S., which may make this important step in the purchase process a critical issue. Cartus Home Loans explores the potential appraiser shortage and impact of inventory on the appraisal process.
Shortage of Home Appraisers
Many home appraisers left the field during the real estate downturn. As a result, securing an appraiser may prove to be difficult, leading to delays in the process. This shortage may impact the transferee’s timing, as well as affect corporations through increased costs for temporary living and storage if the appraisal process delays a closing.
Impact of Market Inventory
Due to the lack of market inventory in many locations, when a desirable property does become available, relocation buyers are often forced into a bidding war to secure the contract. On occasion, a buyer may submit offers over list price by a substantial amount in some markets.
When those winning contracts are submitted to the lender, the process begins on securing an appraisal. The purpose of the home appraisal is to assure the lender that the value of the property is appropriate. In a leading edge market, where prices are rising quickly, it can be difficult for the appraiser to secure the data necessary to support the negotiated contract price.