We received a call from a prospective client who asked about whether or not an appraisal was needed if she were a cash buyer.
She went on to say that the price she was quoted by the homeowner seemed reasonable since her friend had purchased a house nearby for just about the same amount. However, she stated that she had not seen her friend’s home yet and the square footage and number of rooms could not be determined. This means that her friend’s home cannot be used as a valid comparable.
Now, whether someone paying for their home with cash should get an appraisal is an interesting question.
A cash buyer is not working with lenders, who require appraisals to determine whether or not the lending amount is in line with the cost of the property. There is no legal need of an appraisal for a cash home buyer.
Thus, if someone is paying cash, an appraisal is not required. However, a buyer may choose to have a home appraisal even if they’re not opting to do any type of traditional financing.
For peace of mind, an appraisal may be a good idea. Considering you’re spending thousands on a home, an appraisal, which often costs a few hundred dollars, does not tack that much more on the amount you are already spending.
It will assure you, the buyer, that the amount you are paying is the amount the property is worth. You don’t want to be surprised at the appraisal evaluation of your desired property. What if the appraisal comes in much lower than what the agent or homeowner has asked you to pay? The real estate market fluctuates and an appraisal will keep you from overpaying for your new home.
Getting a professional valuation on a major purchase, like a home, is a sensible choice and we recommend it for all home buyers.Tags: appraisal, appraisal cash, appraisal questions, appraisal questions answered, appraisal sale, buy a home, buying a home with cash, cash buyer, cash real estate, does your appraiser, home sale, home value, low appraisal, property appraisal, what is an appraisal, what is appraisal
This post was written by Joseph Castaneda