Appraisal is a document that gives an estimate of a property's fair market value.

An appraisal is generally required by a lender before loan approval to ensure that the mortgage loan amount is not more than the value of the property. The appraisal is performed by an "appraiser" who is typically a state-licensed individual trained to render expert opinions concerning property values. In an appraisal, consideration is given to the property, its location, amenities as well as its physical conditions.

Who owns the Appraisal ?

Even though the borrower pays for the appraisal, the mortgage company owns it. This is because the mortgage company orders the appraisal on the borrower's behalf, and the appraiser lists that mortgage company on the appraisal report. However, the borrower has the right to receive a copy. It is at the mortgage company's discretion whether or not to give the borrower the original appraisal.

Can I use another mortgage company even after the appraisal has been completed ?

Yes. In most cases, changing your mortgage company does not mean you will have to pay for another appraisal. The first lender can transfer the appraisal to your new lender. Some appraisal firms may charge a small fee, however, because there is clerical work involved in editing the appraisal to reflect the new mortgage company. This fee is called an "Appraisal Retype Fee." The original mortgage company has the right to refuse to transfer the appraisal to another lender. In this event, you will need to get a new appraisal.

Assisting your Appraiser

In order for the appraiser to perform his/her job properly there might be requirements for additional information. Some information that may be requested is as follows:

• What is the purpose of the appraisal?
  
  
• Is property listed for sale and if so, for how much and with whom?
  
  
• Is there a mortgage? If so, with whom, when placed, for how much, type of mortgage [FHA, VA etc.], interest rate, and any other types of financing.
  
  
• What personal properties, such as appliances, are included in the property?
  
  
• If it is an income-producing property, a breakdown of income and expenses for the last year or two and a copy of lease might be required.
  
  
• Provide a copy of deed, survey, purchase agreement or other pertinent papers pertaining to the property.

• Provide a copy of current real estate tax bill, statement of special assessments, balance owing and on what [sewer, water, etc.].