Do You Need an Appraisal When Buying Real Estate?
So, you're buying a piece of real estate. The next question is, who orders the appraisal? Do you need an appraisal, and when is it done? Great question!
If you are buying a piece of real estate and your purchase is contingent upon financing, the lender that you're using to obtain a mortgage is going to order the appraisal.
The lender will order an appraisal from a third-party independent appraisal management company who will go out and review the property and determine what that property's market value is in today's marketplace. They will then report that value to your lender, and your lender will lend to you a percentage of the appraised value.
But what if you’re paying cash? Do you need an appraisal then?
If you're paying cash, it is not required to have an appraisal on the property. However, some investors and purchasers may feel more comfortable to have an appraisal done on that property. That would be an appraisal that you would order as the purchaser to verify the value of that property. But once again, it's not a requirement.
So, majority of the time, when an appraisal is involved in a real estate transaction, it is ordered by your lender who's going to be giving you the mortgage.
For questions about buying or selling real estate in Maryland or Delaware, get in touch with us, and we’ll be happy to answer those for you.