Your home appraisal estimates your house's market value based on its assets, appearance and neighborhood.
Make sure you have paperwork to back up any work you have done on your house to potentially increase its value.
Tidying up your house and yard gives a positive impression when your appraiser examines the property.
Home appraisals feel daunting when thinking about equity, because how much home equity you have depends on the results. You might not qualify for the funds you need if your home receives a low assessment. However, the process doesn't have to feel overwhelming if you know how to prepare.
Use these 10 tips from appraisers to maximize the value of your home.
A home appraisal usually happens when you buy, sell or refinance a house. It's also a vital part of determining your home's equity, which you can use to obtain cash and then fund large expenses or pay off debt. In simple terms, a home appraisal assesses a home's market value.
A non-biased third-party appraiser performs the appraisal for a fee. The national average cost of an appraisal is $339, but it can be more or less, depending on your location and the size of your home.
Lenders often request appraisals to check whether the home value is enough to cover the amount they're lending to the buyer. Through a home appraisal, mortgage lenders can ensure they can regain the loan's worth by selling the house at an appropriate amount should the buyer fail to fulfill their contract.
For home equity purposes, your home appraisal helps in calculating your equity amount by subtracting your remaining debt on the home from its appraised market value.
Because your mortgage loan, selling price and home equity are contingent on a high appraisal value, you'll want to do everything you can to maximize the value of your home before an appraiser comes to your property.
Home appraisals are different from home inspections. While home inspectors look for problems and repairs, home appraisers look for value in your home. Here are a few items that affect your home's value:
Condition of the house
Any additions or improvements
Value of nearby homes
Lot size and appearance
Use this 10-item checklist to prepare your home for an appraisal and get the maximum equity from your house.
WATCH: How to Prepare for an Appraisal
If you are at the appraisal, you can answer questions and direct the appraiser's attention to new upgrades. This ensures they don't miss any aspects that add value to your home. This time is also great for showing paperwork or talking up the neighborhood, which can leave a positive impression.
An appraisal is usually part of a larger process with set deadlines. If you need an appraisal done for a particular reason, be aware that it can take time – anywhere from a few days to several weeks, depending on where you live. Don’t wait too long, but try to take the time you need to address any problems or defects that could hurt your home's value.
A paper trail will show an appraiser any improvements or changes you have made to the house that might add value. For example, receipts, invoices or contracts that show when you replaced your roof, upgraded your plumbing, or installed new equipment will be helpful.
An appraiser can only see what is documented or is visible. If your improvements aren't something publicly recorded or obvious, you will need to provide proof to get the credit for the investment.
Other paperwork you should gather include property tax bills, homeowner association fee payment records and other documents that show the home's value.
Certain home repairs are quick to perform and don't require any significant investment, but can impact your overall value. For instance, if you have chipping paint or stains on the carpet, those could negatively influence your appraisal. Taking a little time to treat stains, fix paint and cover holes can contribute to a higher appraisal.
Before your appraiser comes to your home, do a walkthrough to ensure nothing is broken and everything functions. Pay special attention to appliances, lights and doors. For instance, changing a lightbulb or securing a door handle is a quick fix to improve your house's value and appearance.
Your house should give a positive impression from the first moment the appraiser sees it. For example, even though removable items don't add value, you may have a greater chance of your appraiser having a positive view of the home it is clean and decorated nicely.
Some other minor changes you can make for a better experience include mowing the lawn, opening windows for better lighting, and making the home easy to enter and examine.
If you have the budget and have already addressed repairs, consider what easy upgrades you can add that might increase your home's value. For instance, adding a fresh layer of paint or replacing carpets will add value.
Some smaller upgrades to consider could include replacing door handles or resealing your bathroom.
While fixing up the inside of your home, don't neglect the exterior, as it also plays a role in the value of your home. For example, the state of your yard, how your garden looks and curbside appeal are all contributing factors to your home's value.
Not everything that adds value to your home will appear on paper. You can raise your market value by sharing unique insights or facts about your home and neighborhood.
For example, your home might be close to a popular community gathering spot that an appraiser who isn't from the area wouldn't know about.
The appraiser will look at the value of other houses nearby when considering your home's appraisal value. However, you can also collect some examples of similar houses that sold for a high amount.
If you are in the process of selling your house, you might also show a list of offers you have received.
Access your equity through Unlock Technologies for funds to pay important bills, eliminate debt or improve your wellbeing. A home equity agreement is not a loan, so there are no monthly payments. It allows you to tap into the equity in your home in exchange for its future value.
Get started with our home equity solutions and receive usable finances from your home's value.
Our goal is to enrich lives.