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What does an appraiser do?

The appraiser’s job is to calculate the current value of a home given the current housing market. The appraiser is also responsible for ensuring that the home/property meets the HUD’s health and safety regulations.

The appraiser estimates the value of the home based on multiple factors including the cost of comparable homes which recently sold in the area. The appraiser must perform an on-site walk-through of the interior and exterior of the home to make their assessment.

After reviewing the property and the surrounding area, the appraiser writes a report and submits it to the lender. The lender then uses this report to verify that the requested loan is appropriate for the given property and that the property is in adequate condition. The lender cares about the quality of the property because if the homebuyer defaults on the mortgage, the lender takes possession of the property.

An appraisal sounds like an inspection, but a home inspection is different than an appraisal.

Home Inspection

An inspection is an in-depth review of a home and property. The inspector looks at the internal structures of the home such as the foundation, plumbing, electrical wiring, and the roof to make sure that the home is safe and in good condition. An inspection helps the home buyer determine if any major repairs are required. No one wants to be surprised by costly, unexpected repairs shortly after moving into their new home. A good home inspection can prevent costly repairs from surprising a homebuyer.

A home inspection is not required but is strongly recommended. If you cannot afford a home inspector, you definitely cannot afford the cost of unforeseen home repairs.

Home Appraisal

An appraiser assesses the value of a home and ensures the property meets minimum Housing Quality Standards set by the Department of Housing and Urban Development (HUD). An appraisal is primarily to protect the bank's interests—not the homebuyer's.

In short, the appraisal is for the lender and the inspection is for the homebuyer. Lenders require an FHA Approved Appraisal for all FHA loans. An inspection is not required but recommended.

Do I need a FHA approved appraiser?

Yes. If you are buying a home with an FHA loan, you are required to hire an FHA-approved appraiser to evaluate the home and property.

How much does it cost to hire an FHA-approved appraiser?

The cost of hiring an FHA-approved appraiser varies from state to state and by what type of property you are looking to buy (commercial, single-family, etc.).

Typically, appraisers charge several hundred dollars to appraise a single-family home. This will vary depending on your location and the type of property being appraised.

The cost of an appraisal, like other home buying expenses, can often be rolled into the mortgage. This will result in a slight increase in your mortgage payment and allow you to pay off these costs over the length of your mortgage.

Where do I find an FHA Approved Appraiser?

Click here to find FHA Approved Appraisers in your area.

How to become an FHA approved appraiser?

To be added to the roster of FHA-approved appraisers you must apply for certification in the state in which you will be working.

  1. You will have to meet the minimum certification standards per the Appraiser Qualifications Board (AQB) of The Appraisal Foundation. Standards include experience and education among other qualifications.
  2. Make sure you are listed in the National Registry and appear as AQB Compliant.
  3. Submit your application for inclusion on the roster on the HUD website.
  4. Print and sign the application where necessary and upload to FHA Connection.

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