Photo credit: caswell_tom

If you’re a first time home buyer and you’re not familiar with the buying process, there’s a little report you must have to move forward in the sales process once you make an offer on a home. Actually, it’s not a little report. It’s a big report and a possible deal breaker. It’s called an appraisal.

What is an appraisal?

An appraisal is needed to determine the value of the property. The bank needs this to verify the funds they’re lending equal the value of the home.

How do I order one?

Your lender or mortgage broker will set this up for you. They will call an appraiser, set the appointment, and let you know when the work is done.

Who pays for the appraisal?

The buyer pays for the appraisal. The cost for an average 1,800 square foot home is between $300 and $450. You can pay the appraiser directly or have them bill it through escrow and, if you choose the latter, you’ll pay for the appraisal when you close escrow. If you don’t close escrow because of some unforeseen event such as the pest report revealing that termites have eaten through the floorboards and the house is about to cave in, you still have to pay the appraiser.

What if the appraisal comes in over or under my offer?

Let’s say you find a house with a listing price of $300,000 and you offer $270,000 contingent upon the appraisal. The seller accepts your offer. Your lender orders the appraisal and the appraiser determines the value is $300,000. You just pocketed $30,000 in instant equity. Using the same scenario you decide it’s a hot market, houses are selling fast, and you really want the house. You offer $10,000 over asking price for $310,000. The appraiser values the house at $290,000. The bank will only lend on the $290,000. You have 3 choices with this scenario. You can pay the $20,000 difference out of your pocket, you can offer $290,000, or walk away from the deal.

A note to sellers — on the flip side of this coin is something most sellers don’t think of because it’s not written on the residential purchase contract. The contract has a box for the buyer to check that states the offer is continent upon the appraisal but there’s no box for the seller. You can hand write on the residential purchase contract that if the appraisal comes in over buyer’s offer then seller has the right to cancel the agreement. In other words, if the offer is $300,000 and the appraisal comes in at $320,000 you could renegotiate the price or cancel the deal and then change your listing price to $320,000. Really, if the buyer is protected by checking that little box, shouldn’t you be protected too? (more…)

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There’s always a little bit of intrigue the “Before and After” photos of any kind — bodies, cars, hair-dos, and homes. But the most interesting part is in the details, which are, sadly, often left to the imagination. We’ve found some great remodeling blogs, though, that don’t just give remodeling tips and advice, they actually present whole projects to you one step at a time so that you can see the process through from beginning to transformed end.

Kathy’s Remodeling Blog is filled with tons of posts about remodeling, green remodeling, product recalls, and more. The link here will show you a kitchen remodel, which takes over many posts to see the project through, but is a great reference for some great remodeling, along with some real-life experience of project “don’ts.”

Oh, Bungalow has lots of great information on small home improvement projects, even some on gardening as well. Topics are virtually unlimited and include everything from porch swings and plumbing to dining rooms and drywall. The blog even has a blogroll filled with other DIY blogs.

The DIY Diva definitely adds a bit of funk and character to the subject of home remodeling — but she obviously knows what she’s doing, too (except for the sparkler post — no offense, girl). She’s got great perspective on how to plan out major remodels to help you see your way to the project’s potential. (more…)

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If there’s one thing I’m known for it’s multitasking, and if there’s one thing I can appreciate, it’s furniture or other household items that can do the same. And I’m not just talking about my every surface that doubles as an occasional ironing board. One of my biggest rules about “stuff” coming into my house is that it MUST have a function (preferably one we’ll actually use). Bring me something that’s multi-functional and I’m sold.

On Small Space Style, a table was profiled that definitely got my wheels turning. This large, sleek table is simple in design and elegant enough for hosting a dinner party or just feeding your family every evening. During the day it’s used as an office desk and even has handy cubbies under the table top for storing books, papers, and other office supplies.

Upon first glance of this little bench/table/shelf unit, I nearly decided it wasn’t worth a second glance. Luckily, I did look back and once I saw what it looked like in a room setting, I must admit it’s really nifty and cute. It has two shelf niches set on the floor, topped with a long, narrow surface. You can use the surface as a bench or a table top. (more…)

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