How Does a Bank Appraise a Home?
Why a Bank Appraises a Home When you go to a lending institution for a mortgage or a home equity loan it will order an appraisal of the home. The bank is making an investment by lending money on this property and it must know that its investment is as secure as it can be. The bank first will conduct an investigation of the buyer, including the buyer’s credit, job history and other financial information. Next, the bank will want to know if the property is worth the investment it is about to make. This is where the appraisal comes in. Banks normally have a list of licensed appraisers that they use for this service and will assign appraisals based on the appraiser’s certifications. The appraiser completes the property appraisal and sends the report to the bank. If the appraiser’s valuation of the property is in accordance with the loan amount, the bank can lend on that property. If the appraised value doesn’t meet the bank’s standards, then the sale price or the buyer’s part of the invest
