Hello and welcome to TGIF Scoop! 

Appraisals have been an issue lately with both buyers and sellers.

The appraisal process is often baffling, especially to home sellers. They may feel that their home is worth a higher dollar amount, and so the appraised value doesn't always make sense to them. It is important to know that the appraiser is completely independent from lenders, buyers, sellers, and real estate agents, and that the guidelines to which they adhere are dictated by the Uniform Standards of Professional Appraisal Practice (USPAP) and Fannie Mae. In most states, the mortgage lenders must also disclose the purpose of the appraisal, as each transaction carries its own set of rules.

In essence, these important guidelines help appraisers put a fair market value on homes based on comparable sales in the same area, and the home must be bracketed in size and value.

For example, there is no set dollar figure associated with a great view, pool, spa, bathroom upgrades, etc. If a homeowner installs a custom pool that cost them $30,000, but the local marketplace supports the value of a pool at $15,000, then that item will be bracketed as [$15,000] on the appraisal.

Upgrades can usually be expressed at a higher percentage of their value in newer homes because the only way to obtain those upgrades was to put more money into the cost of building the home. On the other hand, the upgrading or remodeling of an older home is rarely reflected in full in the final appraisal. This is because typically 25-40% of the project involves demolition and the fixing of issues that aren't uncovered until the project has already begun, such as plumbing or wiring that may need updating.

Ultimately, the value of the upgrades must be supported by comparable examples within the same marketplace. These comparisons must be drawn from current market activity within the last six months. This is a safeguard to prevent appraisers from attaching too high a value to the home in question, and opening up the appraisal for review. This guideline further states that appraisers can only base their opinion on the value of home sales that have actually closed.

I hope this answers some questions that many of you have been asking about the appraisal process.

Remember, we are the local market experts. We examine local market data and trends daily in assisting our buyers and sellers. Use our knowledge to your advantage!

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Light Scalloped Potatoes
    
•    olive oil cooking spray
•    6 red potatoes, in 1/2-inch slices
•    3 tablespoons whole-wheat flour
•    1 1/2 ounces each shredded Gruyere and Parmesan cheeses
•    1/2 teaspoon garlic salt
•    Ground pepper to taste
•    1 small shallot, finely chopped
•    1 cup fat-free milk, warmed


Spray 11"x 7" baking dish with oil. Line with of the potato; sprinkle one tablespoon of flour, of the cheese, garlic salt, pepper, and of the shallots. Repeat layers. Pour milk on top. Sprinkle with rest of cheese. Bake covered for 25 minutes at 400°F; uncover and bake 20 more minutes, or until potatoes are tender and browned.

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