When you apply for a mortgage, the lender will want to determine the current fair market value of the home. The lender will then order an appraisal. Once the loan is submitted through the automated underwriting system, the results will list to what degree an appraisal is needed. Many times, all that is needed is what is referred to as a ‘desk review.’ This means the lender will review the sales contract and check out recent sales in the area to establish the current value online.
On other occasions, there might be a ‘drive by.’ This literally means the appraiser drives by the property and makes a visual review. This is done after a desk review is performed. Exterior pictures will be taken and included with the property appraisal. If a full appraisal is warranted and as dictated by the automated underwriting ‘findings,’ The appraiser researches recent sales in the area, proceeds to the property, and documents the interior and exterior of the home with a description, sketch, and pictures. After all this is done, the appraisal will be completed.
There’s not much someone can do to help arrive at the final value. However, in the case of a refinance and an appraisal is needed, there are some things you can do to help prop up the value.
The first is to enhance the ‘curb appeal.’ This is a term used to enhance the view of the property from the outside. This means making sure the lawn is manicured and trees attended to. When was the last time the home has been cleaned on the exterior? Seldom? Never? A good power wash might then be in order.
Take a look at your flooring. Get the carpets cleaned and any stains or markings removed. Best practice is to hire a professional cleaning service to go throughout your house for a thorough cleaning. Walls need painting? Usually, a good cleaning will take care of this part but if it’s been a while, a good paint job works. Plus, the smell of newly applied paint does in fact make the home more appealing.
Finally, speak to the appraiser directly and mention any recent upgrades and changes you’ve made. Has there been a recent sale in the area that was done as a ‘for sale by owner?’ If so, the sale likely won’t show up on any database. If you know of the sale and it will boost the value of your current home, let the appraiser know about it.
