| |
|
|
Valuing Your Home
When you're applying for a home equity line of credit, an important step is valuing your home. An appraisal provides an accurate figure for the current market value of your home.
Why an appraisal is important to you and
your lender
Many lenders base the maximum amount of a home equity line of credit on the tax-assessed value of your home. This valuation is made by a public tax assessor to calculate your property taxes. It is usually lower than the appraised value — limiting the amount you can borrow. Countrywide uses the appraised value for the property, so you get the money you need for home improvement, debt consolidation, and more.
Normally, lenders won't make home equity lines of credit that exceed a home's appraised value. It's a good thing they don't. If you needed to suddenly sell for some reason, your proceeds could fall short of repaying the loan. And you'd be forced to make up the difference with cash. What's more, with a home equity line of credit, interest on the portion of the loan that exceeds the home's value isn't deductible
Who does the appraisal
Appraisers are qualified by education, training, and experience to estimate the value of real and personal property. They usually charge one fee for a single-family home and slightly higher fees for duplexes and multi-family homes. The fee also varies depending upon the type of property and location.
What appraisers consider when estimating a home's value
-
General condition and age of the house
-
Size of house and property
-
Location of the home, including views and other remarkable features
-
Features of the home (3 bedrooms, 2 baths, etc.)
-
Major structural improvements such as additions and remodeled rooms
-
Sought-after architectural features such as skylights and fireplaces
-
Comparable properties in the neighborhood that have sold recently and their sales price (this is usually the most important factor in determining the value of a home)
|
|
Equal Housing Lender. © 2008 Countrywide Bank, FSB. Member FDIC. Trade/service marks are the property of Countrywide Financial Corporation, Countrywide Bank, FSB, or their respective affiliates and/or subsidiaries. Some products may not be available in all states. This is not a commitment to lend. Restrictions apply. All rights reserved.