Most Delaware residents are not able to pay cash for a home. Even if they do have a substantial down payment, they still need a mortgage loan in order to pay the remaining portion of the purchase price. In that case, the lender will more than likely require a residential real estate appraisal prior to finalizing the loan.
The price you saw the home you want to buy listed for was likely based on a comparative market analysis. This is used by the real estate industry to help establish a fair market price for a home that is about to go up for sale. In reality, it is more of an educated guesstimate than an actual valuation of the home.
An appraisal is much more in depth and provides a more accurate assessment of the home’s value. The appraiser must be licensed by the state of Delaware and considers many factors in order to come up with a value. Regardless of the method used by the appraiser, his or her final valuation (appraisal) will need to meet the lender’s expectations. If it does, that is one less item to be checked off your list prior to completing your purchase.
A residential real estate appraisal is just one component of your transaction. In order to ensure that your rights are protected throughout the process and that you understand the myriad of paperwork you will be expected to sign, it might be a good idea to include an attorney in your purchase process. Doing so could help you avoid and deal with any issues that may arise during the process. In addition, it may keep any adverse issues from coming up in the future.
Source: thebalance.com, “Facts About Residential Real Estate Appraisals“, Janet Wickell, Accessed on Sept. 14, 2017