Qualifying for Your Property Appraisal
When you have selected the home you would like to purchase or refinance, your home will need to be appraised to ensure that it is worth the value which is indicated.
The amount of your loan will be based on the value of your home, which the certified appraiser will determine. You may obtain an FHA mortgage loan up to 98.15% or your property appraisal value.
The appraisal is a very important step in the process, because it will assure the FHA that their money can be recovered, if you choose to stop making house payments. If this occurs, your lender has the right to foreclose your home without your approval.
While the FHA sincerely hopes this never happens, they must be able to verify that they can sell your home for an equal amount to your loan. You will also be able to determine if you can make a profit should you choose to sell your home before you finish paying off your loan.
An FHA-approved licensed appraiser will be used to inspect your home. This must occur before your mortgage is finalized, and is at your expense.
Any health or safety issues will be inspected. Your appraiser will also inspect three to five of the most recent home sales within a one mile radius of your home. They will select homes which are very similar to your own, to help determine the value.
The value will be determined after inspecting the size, condition, location, yard, and various rooms of the home.
