The process of refinancing is almost the same as what home buyers go through when they get their first mortgage. Refinancing with a conventional lender starts by submitting all financial paperwork. If the documents look good, the lender will request an appraisal.
The law demands an appraisal. An appraiser will come to assess the value of a property and report it to the lender. If the requested Refinance Mortgage in California is higher than the value of the home, the homeowner may have to pay private mortgage insurance on the refinance. Understandably, it is crucial for you to know what the appraiser might be looking for during a visit.
Comparable Properties in the Area
The first thing an appraiser considers when assessing the value of a home is the approximate pricing of all the other residential properties in the neighborhood. While it is impossible to know exactly how much the appraiser will decide your home is worth, looking at other homes in the area will give you a rough idea.
Condition of the Home
The next point of consideration for an appraiser is the size, layout, and condition of the home during the assessment. The appraiser will explore the indoor and outdoor areas, including the number of bedrooms, total number of rooms, number of bathrooms, property square footage, and floor plans.
Condition of the Property’s Systems
Appraisers inspect each of the home’s systems, including HVAC, plumbing, and electrical systems. When inspecting the HVAC, the appraiser may ask questions.
- How old is the HVAC?
- Does it work as it should?
- Does the HVAC emit odors?
- Is there corrosion on the exterior sections of the furnace or air conditioner?
Recent Improvements
Has the kitchen been remodeled or expanded recently? Did you add a bathroom? Are the recent improvements of good quality? Did you install durable fixtures? The appraiser will need the answers to these questions before your Refinance Mortgage in California is approved.
Remember that the recent improvements don’t necessarily have to be remodeled. Even the simplest upgrades, like plumbing replacements or roof repairs, can add to the value of the property.
Amenities Installed
The appraiser will look for amenities that make living in a house more pleasant. It can be an outdoor kitchen or living area, a sunroom, a properly constructed deck, and other similar life-improving features.
Unattractive Features
The unattractive sections of a house will receive as much attention as the beautiful areas during an appraisal. Sometimes, appraisers focus more on the ugly things. From a weird paint job to an outdated kitchen, anything that looks unattractive or outdated to the appraiser will make the house hard to sell, driving down its value.
Location
Finally, the appraiser will consider the location of the property. Is it close to a loud highway? A busy street? Nearby businesses? Is the house within the vicinity of schools, jobs, and other services? All these factors dictate the value of the home.
An Opportunity to Dispute
Appraisers are not always perfect. They can make mistakes that affect the appraisal adversely. When that happens, you may be able to dispute it. However, this is effective only if the appraiser creates an erroneous report. For instance, if they list the square footage of the property incorrectly, fail to mention a crucial amenity, or incorrectly compare the property to homes in a more desirable district, you might have the grounds to challenge the appraisal and claim the Refinance Mortgage in California.
About Us
We are a full-service mortgage brokerage in Southern California.
Contact Us
This website uses cookies.
We use cookies to analyze website traffic and optimize your website experience. By accepting our use of cookies, your data will be aggregated with all other user data.