Jeni VanOrnum | Real Estate Insights & Education

The appraisal process confuses many first-time homebuyers. I’m Jeni VanOrnum, your Douglas County real estate agent, explaining what to expect from home appraisals in 2024.

What Is an Appraisal?

An appraisal is an independent professional assessment of your home’s market value. Your lender orders it to ensure the property is worth the loan amount. This protects both you and the lender from overpaying for a home.

When Appraisals Occur

Appraisals are ordered after your offer is accepted, typically within a week of contract signing. The appraisal takes 7-14 days to complete in Douglas County, depending on appraiser availability and property complexity.

What Appraisers Evaluate

Appraisers examine the property’s condition, square footage, number of bedrooms and bathrooms, lot size, location and neighborhood, and recent comparable sales (comps) of similar homes in Castle Rock, Parker, or Highlands Ranch. They also note any needed repairs or safety issues.

Appraisal vs. Inspection

Don’t confuse appraisals with inspections. Appraisals determine value for the lender. Inspections evaluate condition for the buyer. Both are important but serve different purposes in your home purchase.

Appraisal Costs

Appraisals typically cost $400-600 in Douglas County. You pay this upfront, usually at the time of ordering, though costs are sometimes rolled into closing costs.

When Appraisals Come in Low

If the appraisal comes in below your offer price, you have several options: renegotiate the purchase price down to the appraised value, bring additional cash to cover the gap between appraised value and purchase price, challenge the appraisal with supporting comparable sales data, or terminate the contract using your appraisal contingency.

When Appraisals Come in High

If the appraisal exceeds your purchase price, congratulations—you’ve secured instant equity! This happens more often in seller-motivated situations or when buyers negotiate well.

Preparing for the Appraisal

While sellers are responsible for property condition, ensure the home is accessible and in good condition during your inspection period. This helps appraisers complete their work efficiently.

Understanding Appraisal Requirements

Different loan types have different appraisal standards. FHA appraisals are stricter, requiring certain repairs before closing. VA appraisals also have specific requirements. Conventional appraisals are generally more flexible.

Get Expert Guidance

Ready to navigate the appraisal process? Contact Jeni VanOrnum today. I’ll help you understand appraisals and handle any challenges that arise.