Mobile

Category, Business Name, Address, or Phone

'City,State' or ZIP Code (Fresno,CA or 93727)

Modesto, CA Protect Your Investment with a Home Inspection and Appraisal

Modesto, CA Home Improvement Guide



Home Inspection and Appraisers
Home Inspection Services; Building & Land Inspection Serv; Appraisers

Prior to buying or selling any home, a few key assessments need to be made. Purchasing a home is one of the biggest expenses you will assume and one of the most important decisions you will make. Take the time to do the research upfront and save thousands of dollars and hours of heartache. Knowing what to expect will make the process easier and allow you to make a solid choice before signing the dotted line.

Before making any final choices, an inspection and appraisal should be completed to determine the true value of the home. Both assessments need to be made but they cannot be done together. Each assessment measures the value differently therefore a separate professional is required to provide each evaluation. A home inspection evaluates the current condition of a home and the life expectancy of the building materials. An appraisal determines the market value of the home.


Home Inspection
Home Inspection Services; Building & Land Inspection Services

A home inspection is a third-party examination of the physical structure and systems within a home. Not everything about a home can be determined by what is visible on the surface. Protect your investment by conducting a home inspection prior to your purchase so you know how solid the home is, or what work needs to be done.

What is Covered?
A standard home inspection reviews the condition of both a home’s interior and exterior. The exterior inspection reviews the foundation, landscaping, sprinklers, garage, drainage, fences, doors, windows, roofing, lights, grading, driveway, sidewalks, gutters, and chimney. The interior inspection includes walls, ceilings, floors, framing, insulation, all plumbing, built-in appliances, heating and cooling systems, ducts and ventilation, water heaters, electrical, light fixtures, smoke detectors, and exhaust fans. The inspector will be looking for cracks, structural damage, drainage issues, leaks, improper installation, etc. Most inspections do not include health related issues unless specified or paid for in advance. This includes mold and mildew, radon, asbestos, lead, wood-destroying organisms or rodents. If this is of concern to you, talk with your inspector to include this information.

What Does It Cost?
The cost will vary based on geography, square footage, age of the home, and what is included in the testing. Generally, expect a standard inspection to range between $500 and $700. This is a small fraction compared to the overall price of the home and the peace of mind it can provide is priceless. Never let the cost be a factor in deciding whether to complete a home inspection. This process provides leverage when deciding to move forward with the sale or negotiating the final price based on the needed repairs.

How Long Will It Take?
On average, the inspection takes two to three hours to complete, depending on the size and age of the home. The inspector will need to crawl under the house, climb on the roof, inspect the attic, check every electrical outlet, test every sink, etc. (This takes a minimum of two hours for smaller homes. Be cautious of the quality of the inspection if it is done in less time than this.)

Finding a Home Inspector
It is the home owner’s responsibility to find and select the . Unless you already know someone in this field, a variety of resources are available to help you make a selection:

    References: Begin with your realtor. Because of their extensive experience, they can recommend quality inspectors they have worked with. Ask friends, family and colleagues who they used for their inspection. Verify they were happy with the results and start creating a list of possible inspectors.

    Professional Organizations: A few organizations can also provide home inspectors in your area. Visit the American Society of Home Inspectors website (www.ashi.org) to find a list of inspectors near you. The National Association of Home Inspectors (www.nahi.org) and the National Association of Certified Home Inspectors (www.nachi.org) can also help locate home inspectors in your area. Be sure to check out an inspectors qualifications, experience and training prior to making a final selection.

    Yellow Pages: Local home inspectors can be found in your local Yellow Pages under the heading of Home Inspection Services or Building Inspection Services. Visit MyYP.com, Valley Yellow Pages Internet Yellow Pages directory, to begin your search immediately.

Do some homework and verify credentials and qualifications on organization websites and begin creating a short list of possible inspectors. Sit down with each candidate and review their process. Specifically ask them what processes the state requires and what can be expected in the final report. Ask to see a copy of one they have recently finished to make sure it can be easily understood and is thorough. Select the inspector who you feel most comfortable with and who provides a complete inspection.

What if the Inspector Finds Something Wrong?
If something is discovered during the inspection, it does not mean you shouldn’t buy the house. Every house, even new houses, can have something that was not built correctly or is in need of repair. The final inspection does not result in a pass or fail grade, it only outlines the current condition of the home, repairs that need to be made, and the life expectancy of major components in the home.

You need to determine what repairs or existing issues are deal breakers. If you don’t mind some work, use this information to begin negotiating the final selling price to cover repairs. If you want a move-in-ready home, extensive repairs may send you looking for another home. Whatever your situation, complete a home inspection before buying any home. Make sure your offer indicates the sale is based on the results of the inspection. This provides leverage to back out of the sale if something major is discovered or to negotiate a lower price if you want to fix it yourself.

The seller can also agree to keep the selling price the same and make the repairs themselves. Determine if you are comfortable with this scenario and with the level of work that will be done. If the seller is paying the overall quality may suffer as they may be looking to fix it as cheaply and quickly as possible. Work with the buyer to make sure you are comfortable with their solution.

Be Present
While you are not required to be present at the inspection, make it a priority to be there. Do not pass up the opportunity to be front and center as the inspection is taking place. This allows you to speak directly with the inspector if they uncover any issues or to ask questions about the general condition of the house.


Home Appraisals
Appraisers

A home appraisal establishes the market value of a property. This is typically required by a lending company prior to the approval of a loan to ensure the home is worth the value being extended. The lender wants to ensure the value can be recovered if a default occurs on the loan.

As part of the lending process the buyer traditionally pays for the appraisal after an offer has been made. It provides assurance that the purchasing price of the home is equal to or close to the current market value. If it is higher, the seller cannot adjust the price as an agreement is already in place. Only the buyer can back out at this point, should the amount be significantly lower than the asking price.

In order to protect themselves and due to recent real estate volatility, many sellers are also opting to have the home appraised before placing it on the market. This provides them with a realistic asking price for the home and allows them to make any repairs or changes that will increase the value. It won’t save the buyer from needing an appraisal well but it can maximize the value for the seller and maximize the profit.



What Is Included?
The appraiser evaluates the property based on the following:

  • Square footage of the home
  • Size of the lot
  • Year it was built
  • Materials used for the exterior and foundation of the home
  • Improvements made to the home (including materials used)
  • Comparison to three similar properties in the area
  • Local real estate market evaluation
  • Major structural damage or repair findings
  • Evaluation of the neighborhood

As each appraiser is different, the final result can be subjective. Therefore, it is crucial that you choose an appraiser who is experienced, educated, and licensed by the state.

While the appraiser will indicate serious structural damage or point out obvious repairs, they are not a home inspector. An appraiser will not check appliances, heating and air conditioning, plumbing, electrical, etc., to make sure they are in working condition.

What Does It Cost?
An average appraisal cost ranges from $300-$500 depending on the size of the home. Traditionally, this cost is paid by the buyer either independently or as part of the closing costs. Many current sellers opt to pay this smaller amount in hopes of gaining thousands on the back end when the home is sold. Therefore, they are purchasing their own appraisal to help determine the asking price and ensure it is in prime condition to garner its full value.

Appraisal Methods
There are two standard methods appraisers use to determine a property’s market value.

    Sales Comparison: This method estimates the value based on similar properties recently sold in the area. Considerations are made adding or subtracting value based on similar square footage, finished space, age of the home, materials, additional features, garages, etc.

    Cost Approach: This method is the most accurate and is often used on newly built homes. It is based on the full replacement value of the home should it be destroyed.

Selecting an Appraiser
Some decisions may be out of your hands. Depending on your lender, you may need to accept their choice of appraiser. Until recently, many lenders used on-staff appraisers to determine property values, but this method has fallen under scrutiny due to the recent housing crisis. Some lenders pressured in-house appraisers to inflate home values in order to make more home loans available to more individuals. This dilemma has caused more lenders to use independent appraisers. Regardless of how much influence you have on the final appraiser, make sure the one that is selected meets the following criteria:

  • Licensed in the state they work
  • Have the required training and intern experience
  • Independent third-party with no connection to the buyer or seller

What if the Amount is Low?
If the appraisal amount comes in under the purchasing price, don’t immediately pull out of the sale. Depending on the difference, the lender will most likely not approve the loan. However, there are a few options you can pursue if you are still interested in the home.

    Evaluate the Amount: If the appraisal is significantly below the asking price, this should be a huge red flag! This is a sign that the seller is over inflating the value of the property. Evaluate whether the emotional appeal of the home is worth the extra dollars, or work with the seller to negotiate a new price.

    Evaluate the Reason: Determine what caused the lower appraisal. It may have been due to needed repairs or maintenance. If the seller is willing to fix the problems, a second appraisal can be done and the newer amount may be approved.

    Get a Second Opinion: Like with a medical diagnosis, perhaps a second opinion is required. Request a second appraisal by an experienced and licensed appraiser who the lender also approves. Perhaps the first appraiser was newer and inexperienced. The second opinion will determine if the value holds true or if the first appraisal under valued the property.

    Increase the Down Payment: If the property has a lot of emotional value, consider increasing the size of the down payment to bring the loan value in-line with the appraisal.

    Negotiate with the Seller: Work with the seller to consider a combination of lowering the value and increasing the down payment.

If after these options, no progress has been made, walk away from the sale. An appraisal protects the lender and the buyer from paying too much for a property. Make sure the amount you pay is a strong investment and is in position to build a return from the time of purchase.

 
website statistics