Buyers in today’s market in South Orange County often have questions about the importance of getting a home appraisal and an inspection in order to compete with other offers.
The question that I often get is whether that is the best choice. Purchasing a home will likely be the biggest transaction in your lifetime, so you need to protect your interests. Below are key items to consider for the home appraisal and home inspection.
Home Appraisal
The home appraisal is a critial step in securing a mortgage as lenders require that your loan-value falls within the underwriting guidelines. When the appraisal comes in lower than the purchase price, this is known as the appraisal gap, which means you may need to be prepared to bring extra money to the table as the buyer. You can structure this into the purchase contract based on your comfort level and financial resources as the seller will often ask for this in today’s market.
Home Inspection
The home inspection is equally important as it gives unbiased opinion of the home and may uncover unknown costs that you could incur as a homeowner, such as a new HVAC system or roof, to name a couple. It is important to hire an inspector who is a part of the American Society of Home Inspectors.
In the contract, the buyer can still request but note that they will still cover up to a certain dollar amount of repairs in order to still have a competitive offer. Waiving the home inspection all together could be very risky and cost you thousands of dollars down the road.
In Summary
Both the appraisal and the inspection are important steps in the homebuying process as they protect your interest. Let’s connect so you have an expert guiding you throughout the entire process.