Appraisal FAQ – Need to know info for Boston condo buyers
A home appraisal is part of nearly 85% – 95% of Boston condo for sale home sales. It is not 100% because some Boston condo sales are cash and do not require an appraisal. (Pro Tip: A cash buyer can hire an independent appraiser to evaluate the Boston condo for sale and make their offer contingent on their satisfaction of that independent appraisal. This is not common, but also not a bad idea.) Also appraisals are used for home refinances, but in this article we will focus on an appraisal for a real estate transaction in Boston.
Here is what you need to know about downtown Boston home appraisals:
Who pays for the appraisal?
The Boston Midtown condo buyer pays for it and it is not included in their down payment, nor in their closing costs for the loan. Typically this is an out-of-pocket expense for the buyer, similar to the buyer’s home inspection cost.
What happens if the appraiser gives a lower value than the offer?
All bets are off. The default offer contract for a Boston condo let say in Beacon Hill specifies that the whole offer is contingent on an appraised value meeting the sales price. If the buyer wants to walk away at this point they can and get their earnest money back. There are a few possible solutions to move forward if the buyer still wants to. The buyer can make up the difference in cash at closing. The downtown condo seller can reduce the price. Or the buyer and seller can work out a compromise between the two options.
How long does an appraisal take?
An appraisal in downtown Boston for a regular Boston condo for sale (under 4,000 SF) takes between 15 min. to one hour, in my experience to view the property..
Should I stay home while the appraisal is taking place?
You can if you’d like, but it is best to take a walk or let the appraisal visit themselves. They often have access to the property via listing real estate agent.
What is an appraisal?
A home appraisal is an unbiased estimate of the true (or fair market) value of what a home is worth. All lenders order an appraisal during the mortgage loan process so that there is an objective way to assess the home’s market value and ensure that the amount of money requested by the borrower is appropriate.