Every Monday Morning at 8:15am, join me on my Facebook page as I sit down with a local lender, and do a live interview and talk about a Mortgage Tip that may help YOU with your next Real Estate Purchase.
This morning I sat down with Justin Froiland from Fairway Mortgage. Listen as Justin explains the importance of researching credit repair companies prior to working with someone to build up your credit. You can reach Justin at 605.695.1429 or firstname.lastname@example.org. His office is located at 412 5th St., Brookings SD 57006 or on the web at www.BrookingsMortgage.com
Home Inspections vs. Home Appraisals
- Good mornin' everybody, how you doin'? Shane here from the Brookings Home Team, powered by Century 21. And once again, it's Monday morning, sorry we're a couple minutes past 8:15, we were-
- Too busy chatting.
- A couple of hens over here just chattin' away. But we are on, 8:15 Monday morning. It means Monday Morning Mortgage Tip. Justin here from Fairway Mortgage and let's just jump right into it. What do you got for us today Justin?
- Yeah, thanks Shane for havin' me. So today what I wanted to spend a little bit of time talkin' about is the difference between a home inspection and a home appraisal and where they come up at in the different types of the processes. So, the home inspection is generally something that will be done first. And that's something that when you're working with Shane to write an offer on a house you will determine if that's something that you're gonna want to get done or not. And I can let Shane chime in a little bit as far as his recommendations go. I always think it's a good idea to get a home inspection, certain times in competing offers that can be a little bit different story, but basically what that home inspection does is you put an offer contingent on that home inspection which usually gives you seven to 10 days to get an inspection on the property done. Shane's got a number of different people that he can put you in touch with to get that inspection done. And what they do is they really go through and they look at the big ticket items in the house and they'll go look at everything, but they're really good for the big ticket items. So you know if the furnace is gonna be goin out in the next year, or if you need a new AC unit before summer, or whatever the case may be like that. And what it does is it allows you some time to, if some major items come up that you're not comfortable with you can back out of that contract. So, that's typically when the inspection's done. And we always wait to order the appraisal until after the inspection's done to make sure there's no issues that come up with that inspection. And so the appraisal is something that your lender will take care of ordering. You really won't, as a buyer, won't have anything to do with that process. We'll get it all done on the back end. And that's the process that really determines what the value of the home that you're purchasing is, to make sure the house isn't worth 140 and you're payin' 160, or something along those lines. And every once in a while we've seen 'em come back over what you're paying as well, so that's always a bonus.
- That's good. Instant equity!
- Right? Nice surprise there. But what that appraisal does is they'll determine the value of that property and if there's any repairs that will be required per the lender and the appraiser to make that deal happen. And so, they're two separate costs. The appraisal usually costs between 450 and 550 and home inspections between two and three hundred?
- Yup, right in that range.
- Usually, right in that range. So, that's kind of what I wanted to talk about today Any questions at all Shane, or anything you'd like to throw in there?
- No, just wanna throw in there some people get confused with the inspection and the appraisal, and they think they have to have the inspection and really, you don't. As an agent, like you said, by law we have to recommend you do one. It's still completely your decision if you wanna have an inspection or not. If you take a loan out, or if you're going to be financing that home, you have to have the appraisal.
- There's generally no question about that.
- So you have to have that appraisal. But they are two different things, in a sense. And then of course we can get into a lot more detail if you're doin' a government backed loan with an appraisal, FHA, VA and all that stuff, there's certain requirements there, but that's a
- whole different can of worms.
- Different conversation, yeah.
- Yeah, yeah exactly.
- And the only other thing I'd mention on that is, sometimes the lender, it's lender specific, like for example Fairway Mortgage does not require an inspection, but some lenders will require an inspection. So it's probably pretty important to check. And that can also be dependent on, a lender may require it for one loan program, but not another, type of deal, I've seen that in the past. So, something to just be talkin' with your lender about.
- You bet, you bet. All right, good information today, thanks Justin for that.
- Yeah, thank you.
- If you guys like this video, please share and tag this with anybody else you think would be interested in viewing it as well. Thanks for watching here and please give us a, if you do have a question for myself or Justin that you'd like answered on our next episode, let us know, message us, on the bottom, on the sides or on the top. Exactly where all of his information's gonna be! If you do have a question, or something there that you'd like answered later on! So, thanks again for watchin', that's this Monday's Morning Mortgage Tip. We'll be back next Monday at 8:15, guys! Thanks for watchin', see you later.
- Thank you!