the Price of Home Appraisals

My wife and I were thinking that with interest rates going down, it might be a good time to completely refinance our house. Rates were right about 5.5% at the time and it would have been really great to have this done. I contacted a mortgage company and they requested $300 upfront for the appraisal. At that point, everything was approved and waiting for the numbers to come back from the appraiser. If the numbers were good, the loan was all set to go. Unfortunately, the numbers did not come back as high as I thought they should have and our loan was rejected because of the appraisal. On top of that, I was out $300.

The appraiser was a relatively new person and a supervisor was with the person. Our house is a 4 level split. You enter and walk onto the main floor. Off the main floor there are stairs that lead upstairs to three bedrooms and a bathroom. Another set of stairs go down to the family room and a bathroom. From the family, another set of stairs go into the basement where we have yet another bedroom.

The appraiser would not count the bedroom in the basement because it was below grade, meaning it was below ground level. Ok, I could live with that. However, the family room and bathroom were also considered below grade even though only half of the room was below ground level.

So as far as the appraiser was concerned, even though my house has 4 levels, only 2 counted in this appraisal and there was nothing I could do to challenge her.

Never, ever, ever, pay for an appraisal up front. I'm out $300 because I did. Instead, have the mortgage company include the appraisal as part of the loan amount. That way you're not out of the money up front.