How to Avoid a Low Home Appraisal

A house needs to be sold three times when it is on the market. First, it needs to be sold to other agents so they will want to show and sell the home. Second it needs to be sold to buyers and lastly to the appraiser. Even if the buyer is willing to pay a certain price for a home they usually need a mortgage. That means it is actually the bank who is buying the home. The bank wants to protect their investment so they do an appraisal.

When the appraisal comes back low or as an under-appraisal deals can fall apart. If you are a seller or a buyer you need to know how to protect yourself from short appraisals?

Here are some suggestions from Bankrate.com for buyers and sellers.

If you're a buyer:

-- Tell your lender to find an appraiser who comes from your county, or perhaps a neighboring county.

-- Request that the appraiser have a residential appraiser certification and a professional designation. Examples include the Appraisal Institute's senior residential appraiser, or SRA, or member of the Appraisal Institute, or MAI, designations.

-- Meet the appraiser when he or she inspects the home and share your knowledge of recent short sales and foreclosures that might skew the comps. "Many appraisers are just pulling up data out of MLS (Multiple Listing Service) or off the deed at the courthouse and not checking it out," Sellers says. "Most good appraisers will appreciate the information." And yes, you can speak with your appraiser; the prohibition only applies to your lender.

If you're a seller:

--·Get an appraisal before you list a home. Search for a qualified appraiser in your area on the Appraisal Institute website.

-- Use the appraisal to set a realistic listing price for your home.

-- Give a copy of your pre-listing appraisal to the buyer's appraiser. The more professional appraisers will understand that you're just trying to add more data and another perspective.

-- Question a low appraisal. There's always a chance the appraiser or a supervisor will take into account new or overlooked information.