How Does a Home Appraisal Work?

Appraisals are a very important part of the home selling process.  After all, if you have a Buyer willing to pay the asking price, you don't want the appraisal to come back too low, because then the Buyer can't get the loan unless you lower the price, or they bring the difference to the closing table (and let's face it- how many Buyers really have that much ready cash to bring to closing???).


So, while your renovations may be a factor in selling the home more quickly due to increased curb appeal and Buyer preferences, do they really add value to the appraisal?  While many upgrades are important in attracting potential buyers, in many cases, they just do not add additional value to the home.



What goes into a Lender's Appraisal?


To find out how FHA Appraisals work, Click Here.
To find out how Fannie Mae Appraisals work, Click Here.
To find out how Freddie Mac Appraisals work, Click Here.


Best advice- seek a professional opinion from a Licensed Realtor about what renovations make the most sense (when getting your home ready for sale ) for your market area BEFORE you hire the contractor.  And be prepared to find out that even though you spent $50,000 in upgrades, your home may not appraise $50,000 higher than it previously did.  But, it may sell a lot more quickly than the house next door that has not been remodeled- most Buyer's like a home that is move-in-ready where the work has already been done.  Just be sure to keep themes neutral, as your taste and the tastes of potential buyers may be different...