馃攳
Learn The Differences Between Inspection and Appraisal | The Brandy Whitmire Mortgage Team - YouTube
Channel: Brandy Whitmire
[0]
- So, the appraisal
[2]
is required
[4]
by the lender
[6]
and is required to be ordered
[8]
through an Appraisal Management Company,
[10]
or what's called AMC,
Appraisal Management Company.
[14]
So, the appraisal and even the process
[19]
of ordering the appraisal through the AMC
[22]
is designed to protect you
as the buyer and the lender
[27]
to make sure you're not purchasing
[28]
a home that's being overvalued
[31]
and it's gonna make sure that the lender
[32]
is not over-lending on the home
[35]
and they don't get stuck with a home
[37]
that's not worth the amount
that they put the money on,
[40]
just in case it forecloses.
[42]
So the house is the actual
collateral for the loan
[46]
that's being sent to you,
or being given to you.
[60]
Today's topic is about
[64]
the difference between an
inspection and appraisal.
[65]
But first, I'm Brandy Whitmire,
[67]
I am a direct lender, broker,
[70]
banker, handle all of your
loan needs, nationwide.
[75]
And also, any of your real estate needs
[78]
or questions nationwide.
[80]
So if you have anything at all,
[82]
if you need any questions
or have any questions,
[84]
you can refer back to some of our videos,
[85]
reach out to us through DM,
[88]
email, phone,
[email protected], 214-660-5000,
[93]
and we are here to answer any
of your questions, always.
[97]
So, what is the difference between
[99]
an inspection and an appraisal?
[103]
So, this is something that's
been coming up a lot lately
[108]
with some of our home owners and,
[110]
or sorry, some of home buyers.
[114]
So, an inspection and an
appraisal, are they both necessary?
[119]
What are they?
[120]
Do we need them?
[122]
They are very different and
serve very different purposes.
[126]
So, this comes up, again,
during the purchase time,
[130]
not really refinance because this
[131]
is when the buyer actually does
[133]
an inspection during the option period.
[136]
So the inspection,
[139]
or the inspector, is solely
hired by the home buyer
[142]
and it is designed to
protect the home buyer only,
[145]
so the lender never sees that.
[147]
It's designed to protect the home buyer
[148]
so you know what you're getting
into in this house, okay?
[153]
So the buyer basically hires the inspector
[157]
and it's typically within the
first week of the contract,
[162]
once you've entered into the contract,
[164]
you wanna go ahead and get
the inspection assigned
[168]
or scheduled so that you can
get that completed and done.
[172]
So this is typically done
within the first week
[174]
or so of the contract and
the contract will read
[177]
this as an option period, okay?
[180]
So the option period is
typically about three to 15 days
[183]
where you're gonna put down a small amount
[185]
of money to be able to get out of
[187]
the contract in case you change your mind
[189]
or find out that things in the appraisal,
[191]
I'm sorry, in the inspection,
that you didn't like,
[194]
or that you can't come
to terms with the seller.
[199]
So, the buyer, or you, you as the buyer,
[202]
will meet the inspector at the
home that you're purchasing,
[206]
while they're doing the
inspection or when they are done.
[210]
So typically you wanna go
at least when they're done
[212]
so the inspector can go through the house
[214]
and show you any of the
major problematic areas.
[218]
I don't recommend being
there the entire time
[220]
with the inspector, per se,
[221]
'cause it's gonna take him about three
[222]
to four hours to do it
and you don't wanna get
[223]
in their way the whole time.
[225]
You want them to be able to do their job
[227]
and go through their due diligence
[229]
and then come back to you with
what is absolutely necessary.
[232]
Then you can ask your
questions at that time.
[234]
But the inspector stays at the house
[236]
for about three to four
hours and they're gonna go
[239]
through every single crevice of that home.
[242]
So that means from the
roof to the foundation,
[245]
and everything in between.
[246]
So, roof, foundation,
plumbing, all the appliances,
[250]
the electrical, like
literally every single socket
[254]
and every single crevice of that home
[256]
will be inspected thoroughly
from the inspector
[260]
and you're gonna get back a report
[262]
that's gonna be probably
about 20 pages long.
[265]
I've seen inspection reports
come back 50 pages long
[269]
just depending on the size of the home.
[271]
So, there's gonna be a long list,
[275]
there's going to be a
long list no matter what.
[277]
Even if it's new construction,
no home is gonna be perfect.
[281]
So no matter what, you're
gonna get back a list
[283]
that's gonna be basically your to-do list
[286]
of things that need to be looked at
[288]
or need to be addressed now
or eventually on the home.
[292]
So, what you're going
to be looking for here
[295]
are major problems like
with the foundation
[298]
or the electrical or
the HVAC, the roofing.
[302]
If there's leaks in the roof
[303]
and it's leaking into your attic
[305]
and that's gonna cause
mold or whatever the case,
[307]
you wanna know of these
major, major problems
[310]
so that you can then go back to the seller
[314]
and have your realtor put
together a repair request
[317]
or renegotiate the terms of the contract.
[319]
Maybe you're willing to
live with these things,
[322]
but now since you'll have
to fix them yourself,
[325]
you want to lower the contract price
[327]
or you need the seller to fix them
[329]
before you're willing
to actually go forward
[332]
with the contract past that option period.
[336]
So, when you are ready
[339]
to move forward,
[343]
move forward with the home,
[345]
and you're okay with everything
[346]
that came back on the inspection,
[347]
you've come to an agreement
with the seller, if any at all.
[350]
Most often times there's
not really anything
[351]
that you're gonna go back and fix.
[354]
You know, most of the time,
[356]
unless you know there's gonna be problems,
[360]
you're gonna be okay.
[361]
But, the inspection is
made for that, right?
[363]
It's to find the things
that are not clearly seen.
[366]
It's to find the things
that are maybe fixed
[368]
with a bandaid that you need to know
[370]
before you make this huge purchase, right?
[373]
So when you're ready to move forward,
[374]
it's now gonna be time to
order the appraisal, okay?
[378]
So, now the appraisal's different,
[380]
the appraisal is required by the lender
[383]
anytime you're purchasing a home.
[385]
Unless you're paying cash,
then obviously you don't need
[387]
an appraisal, you just agree
on the price with the seller
[390]
and you can move forward.
[391]
I still recommend doing an inspection,
[392]
even though whenever I'm buying homes,
[395]
I still do an inspection
because that time,
[397]
that three to four hours,
[398]
to pay three to $400
for three to four hours
[402]
of someone that this
is their job everyday,
[404]
day in and day out, and
knows what to look for
[407]
is well worth it to me 'cause
[408]
it gives me a very good to-do list
[410]
on everything that I need
to do in order to make
[412]
the house in good shape
for the next buyer, right?
[416]
So, the appraisal is
[419]
required by the lender and
is required to be ordered
[425]
through an Appraisal Management Company,
[427]
or what's called AMC,
Appraisal Management Company.
[431]
So, the appraisal,
[434]
and even the process of ordering
[436]
the appraisal through the AMC
[439]
is designed to protect you as the buyer
[442]
and the lender to make
sure you're not purchasing
[445]
a home that's being overvalued.
[447]
And it's gonna make sure that the lender
[449]
is not over-lending on the
home and they don't get stuck
[452]
with a home that's not worth the amount
[455]
that they put the money on,
just in case it forecloses.
[458]
So the house is the actual
collateral for the loan
[462]
that's being sent to you,
or being given to you.
[466]
So, at that point,
[469]
as a lender, we're gonna
order the appraisal
[471]
through the Appraisal Management Company,
[473]
they're gonna set an
appointment with the appraiser
[476]
and the seller and within the
first hopefully couple days,
[482]
depending on the area or the busy season.
[485]
But, the appraisal will
then go to the home,
[487]
they're gonna be there about
30 minutes and that's it
[490]
and they're gonna be taking
pictures of the inside,
[493]
of the outside, of all the rooms.
[495]
They're gonna be measuring each
room for the square footage.
[498]
They're gonna be getting a count
[499]
for the rooms that are
there and the amenities.
[503]
So, the number of living
rooms, dining rooms, bedrooms,
[506]
bathrooms, utility rooms,
number of garage spaces,
[508]
the sheds, the pools, any
kind of amenities like that
[511]
that's going to actually
add value to the home.
[515]
But other than that,
there's not much detail.
[519]
It's not nearly as thorough
[521]
as the inspection process with the buyer.
[525]
So, at that point,
[526]
after the appraiser's
done all of his work,
[529]
the appraiser's gotta then go back
[531]
and do the desk work, right?
[532]
Gonna go back and do
the actual metric work
[534]
to the loan, or I'm sorry,
to the appraisal report.
[538]
So, they're gonna go in
and all the information
[541]
they got of the number of rooms
[543]
and the lot size and the
square footage and all of that,
[548]
they're gonna enter it into their system,
[549]
upload all the pictures and compare it
[552]
against similar properties in that area
[555]
that have been sold within
the last six months.
[557]
So, typically within the last six months
[559]
unless it's gonna be like a rural area
[561]
or it's an area where
there's different types
[563]
of homes, different sizes of
homes, different builders,
[566]
different lot sizes, things like that.
[568]
Then sometimes we'll go above
[571]
and allow more than six months,
[573]
but typically it's gonna
be within six months
[576]
in that area in a very similar style home.
[579]
So, like a Tutor to a Tutor,
[580]
or a ranch style to a
ranch style, whatever,
[583]
within the same amount of
bedrooms, give or take one.
[586]
Same amount of bathrooms,
give or take one.
[589]
And typically within about 500 square feet
[593]
to 1,000 square feet because that's really
[596]
where you're getting most of your value,
[597]
it's like the price per square
foot is what we're looking
[600]
at typically whenever we're doing comps.
[602]
That's one of the major
things that we're looking at,
[604]
and then of course number of bedrooms,
[606]
number of bathrooms, if there's
a pool, things like that.
[610]
You know, I had someone call
in the other day that said,
[613]
"Hey, I bought this
home for basically 250,
[618]
"we just put in a pool for $75,000,
[622]
"so I'm thinking my house will come in
[623]
"at probably around 325 now."
[625]
And I'm like, no, that's not how it works.
[627]
You're not gonna get the value,
that 75,000 of that pool,
[630]
right away because it's
just going to be compared
[634]
to houses that have been sold
within the last six months
[637]
that have a pool within the same kind
[639]
of parameters of that home,
[641]
of that home that's being,
the appraisal's being done on.
[645]
So, it doesn't necessarily mean
[647]
that just because you do upgrades,
[649]
or whatever the case may be,
[650]
it doesn't mean that you're gonna get
[651]
that full value back right away.
[654]
It might need to take time
or you wanna do the upgrades
[658]
in the home that's going to be relevant to
[660]
or a comparable to the homes that are
[663]
in that neighborhood at that time.
[667]
So, once they enter in
all that information,
[670]
they upload all the pictures,
they're gonna go and see,
[672]
get the information
over the last six months
[674]
of the properties that have been sold,
[676]
they're gonna go in and
give their opinion of value.
[680]
So, once that's done, they're
gonna send in the report
[684]
to the lender, it's gonna go
through some quality control,
[686]
then it's gonna go to the
underwriter of that lender
[689]
and just to make sure
everything was done correctly,
[692]
it passes all the tests, all
the quality control tests,
[698]
and to make sure that the
appraiser gave it to us as-is.
[702]
So, is allowing this to go as-is.
[704]
If not, it might be in lieu of repairs.
[709]
So at that point, we'd
have to go back to you
[710]
and say hey, you know, we
got the appraisal back,
[713]
and this and this and
this needs to be fixed
[715]
in order for the home to be insurable,
[717]
at that point you can then
again go back to the seller
[719]
and say hey I need these things fixed,
[721]
or we can move you over to
maybe a renovation product
[724]
that will allow for those things
[726]
to be fixed within a renovation loan.
[728]
So, you know, it just
depends on the product
[732]
and what you wanna do,
[734]
but there's gonna be an option just
[736]
in case the home is not insurable.
[739]
And again, no home has
to be in tip top shape
[742]
or perfect to you to get a loan.
[743]
That's what the renovation
products are for.
[745]
So we've got four different
types of renovation products,
[748]
we've got two renovation
products with FHA,
[751]
one's a full consultant,
one's a streamline,
[753]
for just maybe cosmetic things.
[756]
We've got a home style renovation loan,
[759]
that's a conventional loan
for you investors out there
[761]
if you want to do
something like add a pool,
[765]
add an addition, things like that.
[767]
And then we have VA renovation
loans, too, for our veterans.
[771]
We have a VA renovation loan
[772]
that also has its own set of parameters,
[775]
so there are options no matter what type
[777]
of home that you're buying in order
[780]
to get the loan approved
and get this done.
[782]
This is also true with refinancing.
[784]
So right now, refinancing and refinancing
[787]
to your renovation loan
is huge 'cause there's
[789]
a whole bunch of equity and
there's so much opportunity
[791]
to either do cash out
or do a renovation loan
[794]
because of the equity
because now you can go
[797]
and get the upgrades that you want,
[797]
you can add the pool that you want,
[799]
'cause there's room now within
[800]
the appreciation of that loan.
[803]
So, you know, if just doing a
regular refinance right now,
[807]
if we got you closed in
the first week of January,
[809]
it's possible that you could
defer that January payment
[811]
and skip that February payment,
[814]
take those two payments
and pay off Christmas debt,
[816]
or do whatever you want with it,
[818]
or take that money and put
it back on towards your loan.
[820]
So, right now is a good time to look
[823]
at those options and December is
[826]
a kind of a good time
for buyers and sellers.
[830]
Like weirdly a good time for buyers
[832]
because there is not much inventory,
[835]
so there's more ways to play.
[838]
And for sellers, it's the same,
[839]
there's not a lot of inventory out there,
[841]
so you have more buyers per
property, typically in December.
[846]
So December is a very good time to look
[849]
and play around with
seeing what's out there
[852]
and maybe putting your
home on the market during
[855]
this holiday season and
also when it's cold outside.
[857]
So, some things to think
about, some things to look at.
[862]
You know, again, after
the appraisal's done,
[865]
that house is approved, now
you just gotta make sure
[867]
you've been approved, so
hopefully during this time
[869]
you've sent your lender,
hopefully that's me and our team,
[872]
but you've sent the lender
all of your documents,
[875]
everything that they need
to get you, as the client,
[878]
or as the borrower, approved,
[880]
so there's always two things, right?
[881]
Well, we need to get the house
approved to figure that out,
[883]
then we need to get you
approved to figure that out.
[885]
Once we have those two approved,
[887]
we're ready to get you to closing
[888]
and get you into the home and move on.
[892]
So, and as long as you have
those two done, we're good.
[896]
I always like to plant
these seeds just in case
[899]
you think you're driving
down the road one day,
[901]
"And you know what?
[902]
"I heard about that renovation loan,
[903]
"I need my kitchen updated.
[905]
"Hey, I heard Brandy saying something
[907]
"about deferring a couple payments
[909]
"and getting some cash out,
[910]
"I'd really like to pay off my debt.
[912]
"Hey, I heard about it being
[915]
"a good time to put my
house on the market,
[916]
"let me just send her a message
and ask her a question."
[920]
I'm always here for you, so,
[921]
I'm happy to answer any questions
[923]
whether you're doing a loan or not,
[924]
but please reach out, ask questions.
[926]
I'll get 'em answered for you
[927]
or I'll send you to the right place.
[929]
So, direct message me
on any of the platforms,
[933]
email me [email protected],
[936]
you can call us at the
office 214-660-5000,
[940]
we are always here.
[942]
I love giving you guys this information,
[943]
hopefully this video
or this audio came back
[948]
not warbly like the other one.
[950]
I do think the other one was
better, 'cause you know what?
[951]
It's always like taking a picture, right?
[953]
The first picture was always the best,
[954]
but hopefully you still like it
[957]
and if you're one of the 89 people
[959]
that listened to it before,
[962]
maybe you can let me know what you think
[963]
if this one was good or the other one?
[965]
But, anyway, I'm gonna let you all go,
[967]
I'm gonna get outta here and I
will see you again next week,
[971]
next Wednesday at 6:00 p.m.,
[974]
unless I have technical
difficulties, then it might be 6:15,
[977]
or even maybe even 7:00
when I see you again.
[979]
So, hopefully not, but I
will see you again next week.
[983]
Reach out whenever, we're
here for you, thanks.
Most Recent Videos:
You can go back to the homepage right here: Homepage