In both cases you will need to know what you home’s value or worth is; in the first situation to find out how much of a loan you can get while in the second situation you want to learn what your home would fetch on the open market. Read on and we’ll take a look at some options available to you to help you determine your home’s current value and worth.
Appraised Value
If you want an accurate estimate of your home’s value, then a written appraisal is the way to go. Appraisers, who charge around $300 for this service, will visit your home, look over the interior and exterior, and examine recent sales in your neighborhood. An appraisal demonstrates the fair market value of the home and it is required by the mortgage lender before loan approval is granted. You can, however, order your own appraisal at any time apart from a lender.
A Comparative Market Analysis [CMA] is conducted by a real estate broker or other real estate representative and is based on recent sales in your neighborhood. Basically, a CMA determines what a buyer might pay for your home. It can be a different figure than the home appraisal figure and normally it is higher than the appraised amount.
Loan Options
When applying for a HELOC or home equity loan an appraisal of your home will be conducted. When you are putting your home on the market, a CMA will determine your home’s asking price; when a buyer steps forward then his mortgage company will find an appraiser to determine the home’s value. As long as the selling price is near the home’s value then the mortgage will be approved.
Consumers can get even get an idea of their home’s worth through certain online sites offering this service. Zillow.com, for example, provides instant valuation of nearly 70 million homes across the U.S. Enter in your street address and city/state and a current market valuation will pop up within ten seconds time. Please note that the program is new, it is free, and some valuations are inaccurate depending on the information contained within their database.
CMA Does It
So, go ahead and get that HELOC but remember you’ll need an appraisal first. To find the value of your home, a CMA will do just fine.
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