Real Estate Appraisal

General Candice Joy 5 Nov

Your buying, refinancing or building and your mortgage professional informs you the bank has requested an appraisal…

WHAT IS IT?!
Real estate appraisal is the process of developing an opinion of value of a given property. Banks use these appraisals and the values provided by the appraiser to determine how much money they are willing to lend on a given property.

WHY?!
An appraisal is required when a bank or lender needs to know what the fair market value of a property is in order to determine how much money they will lend.  The appraised value of the home also gives the lender an idea what the home could be sold for should the mortgage go into default.

HOW?!
When a property is being assessed, the appraiser is not only looking at the specific details of your home, they are also confirming that the property is being well maintained.
Once the appraiser has assessed the property they are required to provide a list comparable properties which have recently been sold within a close proximity to property being appraised to support the value established by the appraiser.

Who?!
The appraiser MUST be approved by the particular bank/lender that is providing the mortgage.

WHEN?!

  1. Refinancing – This is done when the home is worth more than is owed on the mortgage.  Home owners can then refinance to access their equity either in the form of a Secured Line of Credit or a whole new mortgage giving you a lump sum of money.

  2. Determining Market Rents – if you are buying or converting your current home into a rental and need establish fair market rents for lending purposes an appraisal can be ordered to establish reasonable rents in your area.

  3. Construction and Renovations – when building or doing extensive renovations an appraisal will be ordered to determine the current value as well as the value of the home once the specified work is completed.

  4. Purchasing- There are many reasons that your lender may be requesting an appraisal of the property you are purchasing. Here is a quick list of common reasons that would/could trigger an appraisal.

  • AS IS -when a property is listed on the MLS As Is, the banks may want to confirm the value and condition of the property.
  • private sale- when a property is sold privately and is not exposed to the open market via MLS the bank may order an appraisal to confirm the value.
  • Zoning – if a property is dual zoned or zoned other then residential the bank may want ton confirm value and use.
  • Acreage -if the property has a large land parcel the bank may want to confirm the value.
  • Bidding War -if a home sells for over the original asking price, an appraisal may be required to confirm the home is worth the amount it sold for.
  • Purchase Plus Improvements- when buying a new home you can borrow extra money to modify or update the home, in this case the bank may order an appraisal to confirm the value after the work is done.
  • Concerns -if a property’s located near an automotive garage or in a known contamination zone an appraisal can be required for soil testing etc.

I am always available to answer your questions, information is the key to a successful real estate transaction.

Candice Joy
Email – Candicejoy@mississippimortgages.ca
Text/call – 613 558 1143

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What Is A Home Equity Line of Credit

General Candice Joy 1 Nov

Home Equity Lines of Credit, What are they?

Your Home Equity Line of Credit or HELOC for short, is a loan secured against your home or rental property. Because Lenders use your property as collateral they are provided with increased security which lowers their risk.  Lower risk to the lender results in lower interest rates to You.

Your Home Equity Line of Credit is a revolving credit product, this means your available balance can be borrowed, repaid and borrowed again.  Your Secured line of credit will likely have no set payments requiring that you only repay the interest accrued on the funds used.

Why Make Interest Only Payments?

  • Rental Property down payment – Helps to keep a positive cash flow while your new investment property gets going.
  • Renovations –Making interest only payments allow for much smaller payments than loans making beautiful renovations possible.
  • Job Loss– Repaying only interest on funds needed to bridge the gap while you look for your dream job.
  • Emergency– Having the lowest possible payments can make all the difference during an emergency.

Common Uses for Home Equity Lines of Credit

  • Investing
  • Down payment on an investment property
  • Down payment on a vacation home
  • Consolidating higher interest debts to save money
  • Consolidating debts to lower overall monthly obligations
  • Home renovations
  • Property maintenance
  • Education
  • Emergency funds

A Few Differences Between Products

  • Fixed limits VS limits that automatically increase as you pay down principle on your mortgage
  • Payments that automatically drawn from your desired account VS manually making payments at your convenience
  • All in one Product with your mortgages VS stand-alone home equity lines of credit
  • Interest Rates

Benefits of Home Equity Lines of Credit VS Fixed Loans

  • Lower Interest Rates
  • Lower Payments
  • Funds are re advanceable
  • Flexible Terms
  • No restrictions on what the funds are used for
  • Lower affect on borrowing power than fixed loan payments

Many of our lenders offer Home Equity Lines of Credit each having unique products. Discuss the available options with your mortgage professional.

Selecting the right product is a major factor when looking to gain an edge and take control of your finances.

Contact

Candice Joy

Agent with Dominion Lending Centers the Mortgage Source

www.candicejoy.ca

613 558 1143

candicejoy@mississippimortgages.ca

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