Appraisals - Why do I need one?

In many cases, lenders need a professional, independent appraisal of the property you want to buy or refinance to ensure that it is worth at least as much as they are being asked to lend on it. If you are making a smaller down payment and have a lower credit score, the lender is going to be even more interested in making sure the property that will be collateral for the loan is worth lending the amount requested.

Stonebridge Financial offers programs that will allow for no appraisals on rate/term refinances.  Cash-out transactions do not qualify.  These programs rely heavily on the overall stability of your loan application as well as the equity in your property.

A professional, independent appraiser will usually visit your home and inspect its interior and exterior. The appraiser doesn't want to buy your home, and isn't a visiting head of state. So whatever you do, do not postpone the appraisal until you get a chance to "clean up a little." Cleaning does not make your appraised value higher! And delaying adds time to an already lengthy process.

The appraiser will form an opinion on the probable market value of the property considering sales of similar homes in the area among other factors.  He or she will prepare an appraisal report explaining the conclusion.

An appraisal can cost from $200 to $500 or more for very complex properties. You as the borrower repay the lender for its cost in paying the appraisal fee upon settlement of the loan.