Refinance applications have risen 10% over 2023. This growth is largely because homeowners want to lock their new mortgage rates in the face of recent rate hikes. It can also reduce the loan tenure or provide access to home equity-based cash.
You can refinance your mortgage after a home appraiser evaluates your home’s current condition and completes a refinance appraisal checklist. But finding a reliable appraiser can be stressful, and Houzeo is here to help. Check out our list below!
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What Is an Appraisal?
An appraisal is an evaluation process conducted by a licensed home appraiser to get the property’s fair market value. They prepare a report that estimates the property’s worth based on factors like the neighborhood, and current market conditions.
This report will determine how much money you can borrow in refinance. The total process from appraisal order to closing report takes approximately a week.
Why Is an Appraisal Important While Refinancing?
Refusal of refinance applications has increased to 15.5% in 2023. This means the lenders scrutinize the home appraisal report to confirm they cover their mortgage amount.
Appraisers ensure that banks don’t lend more than the home’s worth and minimize default risk. An appraisal helps negotiate a better interest rate on your refinance. This process keeps things fair for both you and the lender.
7 Tips To Get a High Appraisal For a Refinance
Refinance is a great option to fix your mortgage terms. It can either lock you at a lower mortgage interest rate or get you some additional cash. The higher the appraisal value, the better for you!
The below tips can get you the correct refinance value in less time.
- Enhance Curb Appeal: Elevate your home’s exterior to grab the attention at first glance. Go for fresh bright paint, upkeep the landscape, and clean the walkway.
- Deep Clean: Declutter your house for it to look more spacious. Hire a cleaning agent who can deep clean your house. The appraiser would value your house higher for being a tidy and well-maintained space.
- Minor Touch-Ups: Fix leaky faucets, patch small holes in walls, and tighten doorknobs. Handling these small issues shows the appraiser your home is well-cared for.
- Neutral Paint Colors: Consider repainting bold walls with neutral colors. This creates a broader appeal and allows the appraiser to focus on the home’s features.
- Highlight Finished Spaces: Good basements, attics, or decks can add value. Make sure these areas are clean and inviting before the appraisal process starts.
- Gather Documentation: Keep records of any upgrades or renovations you’ve done. This paperwork can help the appraiser understand the additional value these improvements bring to your home.
- Ask Your Lender: Home lenders may have deep knowledge of market trends and your neighborhood insights. Don’t hesitate to ask him to get those additional tips.
What Does an Appraiser Look For When Appraising a House?
The appraiser looks at the interior and the exterior condition of the house. After this, they present an appraisal report to the lender, based on the examination. The lender then confirms the refinance amount accordingly.
For the interiors, they look for a well-maintained home without any visible faults in plumbing, electric wiring, ceiling, etc. For the exterior, they check the property’s location, neighborhoods, and utility spaces.
Final Thoughts
A positive appraisal report can get you the best refinance value. Hire a professional home appraiser who can guide you with a refinance appraisal checklist.
Once the appraisal process is complete, you can apply to refinance your home. However, you still need a lender that offers you suitable terms. Don’t worry, Houzeo got you covered. Again. Check out our list of verified lenders to get the best quotes!
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Frequently Asked Questions
How long does an appraisal for a refinance typically take?
The appraisal takes approximately one to two weeks. However, this timeframe can vary based on individual circumstances.
Is it hard to get approved for a refinance?
Whether it is hard to get approved for refinance depends on your credit score, debt-to-income ratio, and home equity. Make sure you follow the 7 steps in order to get quick approval.
What do home appraisers look for when refinancing?
Home appraisers look for interior and exterior conditioning of the property. They consider factors like home size, functionality, curb appeal, and comparable sales in your neighborhood. The appraiser determines the home's refinancing worth based on these checks.
