When most folks think of home appraisals they think of purchasing a home and while this is, indeed, the most common use of an appraisal, it is far from the only one. There are many other times in life when an appraisal may be required or may be a wise money-saving move. This article lists six of them below.
1. Refinancing Your Mortgage
People refinance their mortgage for a range of reasons including obtaining a lower interest rate, shortening the term of their mortgage, or tapping into home equity to consolidate debt. In all cases, this means replacing their old mortgage with a new one and because home prices fluctuate, doing so requires a new home appraisal.
2. Applying for a Home Equity Loan
A home equity loan differs from refinancing in that it is a new loan on top of your existing mortgage. For the lending institution to determine the amount you can borrow, they need to know how much home equity you have. This is calculated as the current value of your house minus the amount remaining in your mortgage. Naturally, a home appraisal is required to do this math.
3. Planning Your Estate
Estate planning is about taking care of your family and one essential step in doing so is ensuring your assets are fairly distributed. If a home is part of your estate, you will want to conduct an appraisal so that you can accurately determine how to fairly divide your assets and avoid any sense of unfairness after you are gone.
Any litigation that involves property (such as a divorce or death) also involves a home appraisal. Only upon the basis of an accurate calculation of value can disputes be settled fairly and expediently.
5. Property Tax Assessment Appeals
Escalating property value is all fun and games until the tax bill arrives. However, if you feel like the leap from one year to the next is excessive or if property value in your area has decreased but your tax bill has not, you can appeal. An independent home appraisal helps in this process and could ultimately lead to lower annual taxes.
Your home is likely your most significant asset and so should you need to file for bankruptcy, you want to be sure to get fair market value for your property. Once more, an independent home appraisal helps ensure that this happens.
To learn more about the many ways home appraisals are used or to arrange to have an appraisal conducted of your home today, do not hesitate to contact Appraisals Unlimited either by calling 781-449-7600 or emailing us at firstname.lastname@example.org.