Getting Ready for an Appraisal

By Jonathan Berohn

If you’ve ever refinanced or sold a home, you’re plenty familiar with the appraisal. Some appraiser comes out, drives by your house (they actually call this a “drive-by” appraisal, which I can appreciate if only for its nerve), and for $250 or so you get to find out that your house is worth exactly what every other house in the neighborhood is worth.

There is another option, though. For about $50 to $100 more, you can get a walk through appraisal that actually takes into account what makes your house different from the other run down shacks—er, I mean your neighbors’ lovingly tended abodes.

Why the Walk Through

Naturally, you want to know why you should spring for the walk-through if the drive-by is good enough—especially for most refinancing efforts. In many cases, you don’t need to, but if you are trying to maximize value to keep your loan to equity ratio down (which is always a good plan) a walk-through can make a difference. It will also give you a more precise value of your house for you to base a sale price on if you are contemplating selling a home by yourself instead of through a real estate agency.

Preparation

A walk-through appraisal consists of four things: photos of the outside of your house, a floor plan sketch, an assessment of condition, and a detailed list of improvements. Unless you’re Norm Abrams or Bob Villa, you can’t do much about the floor plan in the short term, but there are a few simple things you can do to get ready for the rest. First, make sure that your landscaping is presentable. Ideally, you’ll start on this at least a week ahead of the appraisal, but at the bare minimum, make sure your yard is neat. A green, well-kempt and weed-free lawn makes a nice backdrop for the house and gets things off on the right foot. First impressions are just as important here as they are in anything else.

Next, think cosmetics. Patch all those nail holes and water damage you’ve been meaning to get to, retouch any obvious paint problems—in short do anything that will make things look better. This is NOT the time for major structural repair. What you need to do is make the problems look OK. You can always go back and tear out the wall later.

Finally, make a list of everything you’ve done to improve the house since you bought it. Include everything. That means paint, roof, flooring, appliances, heating, cooling, lawn sprinklers, additions—every bit of work that you’ve put into the place. Making this list ahead of time ensures you won’t forget anything while the inspector is there. And believe me, even for your $300 or $350 he won’t be there long. Do your homework and make sure you get the most out of that time.