Maximize Your Home Appraisal for a Successful Refinance
If you want a mortgage refinance, you'll want the home appraisal to go well. In fact, the results of the appraisal can, in part, determine whether or not a lender even decides to let you refinance.
A high home appraisal could also get you thousands of extra dollars, allow you to avoid paying for private mortgage insurance (PMI), and lower your interest rate. If you get a low appraisal, however, you could miss out on all those savings.
What You Need to Know About Home Appraisals for a Refinance
An appraiser looks at a lot of factors when determining your home's value. While you won't be able to influence some factors, like your home's location, there are others that you can prepare for.
For example, the recent sale prices of comparable properties are very important, but you can't change them. If homes of comparable properties have been selling at a lower amount, that could negatively affect how the appraiser values your home.
However, appraisers aren't perfect and they might miss some comparable properties that have recently sold well. You could prepare for your appraisal by researching and compiling a list of well-selling properties the appraiser might not now about.
Things You Can Control
While you can't always control the number of rooms in your home, its design functionality, and location, among other factors, you can do things like control how clean it is.
Think of the appraisal like a first date.
Your house should be well-groomed, easy to navigate, good-smelling, and as attractive as possible so it makes a good impression. You don't want your appraiser to feel the need to hurry out.
If your house is cluttered, dirty, or looks like it's not well-cared-for, it can seem less valuable than it actually is. Since there's a range of possible values your appraiser can decide on, do what you can to move the value to the high end of that range with the time and funds that you have.
How to Maximize Your Home Appraisal
If you really want or need a good outcome to your mortgage refinance, you have to be ready to work for it. Appraisers care about the condition of both the interior and exterior of a home, which you can improve with some effort and, possibly, a little money.
Here are some additional suggestions that you can use to get ready for appraisal day:
- Improve the outside appearance of your home by adding flowers, trimming shrubs and trees, cleaning up toys, and increasing your curb appeal
- Fix anything that's obviously damaged
- Make sure everything works, including fans, light switches, and outlets
- Make sure safety features such as alarms are installed and working
- Spend money on improvements and minor upgrades, especially if you can spend $500 or less on a feature that will improve the home's value by more than $500
- Modernize details like faucets, doorknobs, and curtains
- Update your flooring to tile or even newer laminate
- If needed, paint your cupboards and fix or replace your countertops
- Research comparable properties, possibly asking neighbors about appraisal problems and solutions they've experienced, and use their findings, if applicable
- Clean and then clean some more: shampoo the carpet, wash the walls and decks, clear your driveway and yard, etc.
- Prepare a list of valuable nearby features, such as new parks, freeway ramps, stores, schools, and other amenities
- Prepare a report about any tax records that are incorrect
How to Interact with Your Appraiser
Even though you'll want to tell the appraiser all the great things about your home, you need to do it in a respectful, not-pushy way.
One of the best ways to do this is to hand the appraiser a folder when he or she first arrives. The folder can contain a list of your recent home improvements, important records, comparable properties, and any other relevant information you've gathered.
It's also important to let the appraiser do his or her job. After you greet him or her and hand over the folder, you should say you're available to answer questions, then state where you'll be, say "thanks," and then get out of the way.
What to Do If Your Appraisal Is Low
It's difficult to change the outcome of an appraisal after it's finalized. However, an appraiser can make a major mistake, such as:
- Writing down the wrong number of rooms or square footage
- Not using the best comparable properties
- Not reporting a valuable feature, such as a spa or swimming pool
If this occurs, you can write a letter detailing the mistake and send it to your lender and the appraisal management company.
Your Mortgage Refinance Specialists
Even using a few of our tips can potentially have a big impact on your appraisal and your home's value. And, if you'd like more tips, check out one of our previous home appraisal blog posts!
Finally, to learn more about how to get a mortgage refinance, please contact one of the experienced loan officers at Elevate Mortgage.