What exactly is a home appraisal?

A home appraisal is an independent estimate of what a home is worth. It includes a visual assessment of the condition of the home, and a comparison to other similar properties that have sold, or are for sale, in the same neighborhood. Depending on the location and size of the home, an appraisal can cost anywhere from $300 to $400 or higher. It takes a couple hours and is typically paid for by the person who is borrowing the money: the buyer for a new home purchase, or the homeowner when refinancing.

Do I need a home appraisal?
Most lenders require an appraisal for new home purchases. It protects the lender, buyer and homeowner by letting everyone know the final purchase price is in line with the home’s fair market value.

Appraisals are usually required when it comes to refinancing, but not always. Some loan programs like the FHA Streamline Refinance program don’t require an appraisal if you already have, and refinance to another, FHA loan. Other times, the decision to get an appraisal (and avoid the step and cost altogether) is up to the homeowner. This might happen depending on the type of refinancing loan and terms the borrower applied for, and with which lender. Or the requirement could even be waived as part of a lender’s promotional offer. 

If getting an appraisal is ever an option for you when refinancing, it will likely be in your interest to get one. The reasons include:

Your home might be worth more than what the lender thinks, who might not know about upgrades you’ve made.

If you have private mortgage insurance (PMI), having a home valued too high compared to the loan amount could allow you to get rid of the insurance.

If the lender thinks your home’s value is too high compared to the loan amount, that could give you an interest rate that’s too high

What’s the difference between a home appraisal and a home inspection?
An appraisal is a visual assessment of the obvious condition of the home, including the interior and exterior, and how well the home has been maintained. Appraisals also include what are called “comps.” These are a cost and size analysis and comparison to other similar homes currently for sale, or that were recently sold, in the same neighborhood. A home inspection, on the other hand, is an examination of the structural condition of the home. From appliances to heating and cooling systems, it lets you know if everything is working. It tells you about the condition of the home’s foundation, roof, exterior and all parts of the home’s construction. You’ll find out what works, what’s OK, and what repairs might be needed.

What are comps?
Comps are the most important part of a home appraisal, and are the best way to estimate a home’s value. They compare the home to at least three other recently sold homes in the same neighborhood. They include sale price, age of the house, size, square footage, upgrades and any other distinguishing features, like a pool. Because no two homes are the same, starting with these common characteristics is a good starting point. From there, the estimate is easily adjusted up or down to account for differences – if one property has a pool and another doesn’t, the price of the pool is simply added or subtracted from the estimate. After all the variables have been considered, the final value is then stated as a price per square foot. So two homes with the exact same square footage will have a different estimated value based on all the above factors.

What does an appraiser look for?
Remember, an appraiser only looks at the obvious, visual condition of the home. Not the structural integrity, whether something works or not, is in perfect condition or needs repair. 

Here’s a general list of what an appraiser will look at:
Visual inspections of the foundation, plumbing and electrical systems, exterior and roof
Condition and type of interior walls, flooring, fixtures, and appliances
Amenities: extras like a security or intercom system, solar panels, swimming pool, gazebo
Size and condition of the land the home is on, condition of the yard and landscaping
Remodeling or other upgrades to kitchen or bath, and appliances
Number of bedrooms and bathrooms
Quality of the basement and attic
Surrounding neighborhood and area
Sale price of other area homes
Square footage of the home

The appraisal report
When it’s all over, the lender, and the buyer or homeowner who is refinancing, will receive a final report that will include:
Size, square footage and condition of the home
Notes on any obvious problems or areas requiring repairs
Details on appliances and fixtures throughout the home
It will point out any improvements or remodeling
Description of the neighborhood and surrounding area
Maps, photos and drawings of the property
Comps and an analysis of the current market
Source:Kim Kelman - Prime Lending 210-483-4901

Before You Replace The Windows On Your Home

Windows protect your home from elements such as extreme temperatures, wind, rain, snow, and ice. Inefficient windows may allow outdoor air in, causing your air conditioner and/or heater to work overtime to keep the temperature comfortable inside. Damaged windows can also allow water to seep in, causing more problems inside your home.

Are your windows in good working order? Do they add something to the appearance of your home? Old, worn windows can detract from your home’s curb appeal. If your windows are old or damaged, it might be time to consider investing in new windows for your home.

How do you know if it’s time to replace the windows on your home? If it is time for new windows, do you know what to look for? Use this guide to help you make decisions about replacing windows for your home.

Consider getting new windows if…

Windows are damaged or broken — Even if the window itself is intact, a broken or warped window frame should be replaced before you develop real problems with the window. If the window sticks when you try to open or close it, if you feel a draft coming in or if the windowpanes are foggy, it may be time to replace your window sash or frame — if not the entire window.

You want to lower your energy bill — Windows that let in a draft can drive up your energy bill by as much as 25 percent, according to Energy.gov. Replacing your windows with energy-efficient windows can reduce your heating and cooling bills. Energy-efficient windows can also be a big selling point when it’s time to sell your home.

You’ve been through a severe storm — Wind, humidity, and sea salt can do a number on your windows. If you live in a coastal region or another area prone to severe weather, consider replacing your windows with new windows made with storm-resistant materials, which are better able to withstand the elements.

It’s time for a home renovation project — Whether you’re updating a historic home with vinyl windows, or are just simply giving your home a makeover, leaving the old, worn windows will affect the overall look of your home. Consider replacing old windows with larger windows to let in more natural light, and opt for a window that opens, rather than a fixed window sash. If it’s a historical home you’re working with, look for a company that will make custom windows to ensure your new windows are historically accurate, so as not to detract from the look of the historic home.

If you decide to replace your windows, keep these 4 factors in mind…

Choose a window style — When it comes to choosing new or replacement windows, you have some options on style. Here are some basic options to consider:
Single or double hung windows — The most common windows in homes, single or
double windows consist of two separate sashes that open by sliding up or down. A single hung window opens from the bottom, while a double hung window can open from top or bottom.

Casement windows —  windows with one large sash that opens by swinging out.
Awning windows — Hinged at the top, they open by tilting the window out from the bottom. Awning windows are especially popular in coastal regions.
Slider windows — If space is limited outside and there’s not room for windows that open outwards, these are another great option in addition to single or double hung windows. Slider windows open by sliding side to side.

Choose window frame and sash materials — The most popular window materials are wood or vinyl. Wood windows have a more classic, beautiful appearance, but they require more maintenance. Vinyl windows, are popular because they are essentially maintenance-free and are lower in cost than wood windows. You also have the option of vinyl-clad windows, which are wood on the inside with a vinyl coating and wood frame on the outside.

Choose window glass — When choosing which glass to use, there are two basic types to choose from

Low emissivity (Low-E) glass — This glass has a thin, layer of material on the window to reduce the flow of heat through the glass.
Impact resistant glass — Although it may crack, impact resistant glass will not shatter when hit hard.

Consider the quality and compare warranties — Replacing windows can come with a bit of sticker shock, but keep in mind that you get what you pay for. Choose a high-quality window from a well-known company to get the energy saving, low maintenance, durable windows you’re looking for. Be mindful that warranties vary from one manufacturer to the next, so be sure to take a close look at the warranty before you buy. Well-known companies tend to offer the most solid warranties for their products and are more likely to still be around should you encounter any problems with your windows.

Once you choose a window, look for a contractor who is trained by the window manufacturer. Your local Home Builders Association can also help put you in touch with window contractors in your area.

Knowing when it’s time to replace your windows, and choosing the right windows for your home can make a big difference in the value of your home when it’s time to sell.
Source: Kim Kelman - Prime Lending 210-483-4901

Change of Season - Home Maintenance Tips

Before it gets too nasty to work outdoors, take the month to button up your home for the rough weather to come. Here is a handy checklist of home maintenance tasks that need to be completed this month, plus tips for how to do them faster and easier, or with the help of a pro.

1. Weatherproof the house  - 
Locate and seal cracks and spaces that let heat out and cold air in—along baseboards, wall/ceiling junctures, windows, and doors, lighting fixtures, switches, and electrical outlets. Your wallet will thank you because energy savings from reducing drafts range from 5% to 30% per year. For tips on doing an energy audit on your home go to the U.S. Department of Energy.

Tip: At night, ask a partner to walk outside while you turn off all lights and shine a flashlight along doors and windows (tell the neighbors not to call the police). The light will illuminate large cracks. Small ones won’t likely show up, however. For those, light a candle or incense stick and pass it along potential leak areas. If the flame or smoke wavers, you’ve got a leak.

A home audit that finds all the nooks and crannies where energy escapes costs $375 on average. Painters ($25 to $100 an hour) will seal gaps with caulk. Handymen ($30 to $50 an hour) can install weatherstripping.

2. Check fire alarms - Dead batteries cause 24% of smoke alarm failures, putting your family at greater risk of a fire. You should replace batteries or test hard-wired fire alarms twice a year. You knew this, right? Fine, we don’t mind reminding you.Check those batteries for safety, and to stop the beeping.

Tip: Don’t remember when you tested your detector last? Get into the habit of testing the alarm and changing batteries on a specific date like the start of the new year. 

3. Service the HVAC system - Make sure your heating system is running safely and efficiently so you’ll stay toasty during cold weather and save money on energy bills.
Tip: You can unclog and clean HVAC grilles by popping them in the dishwasher. (Leave out the dishes, preferably.) Also make sure you dust heating returns and change filters every one to three months.
An HVAC expert ($60 to $85 an hour) is the best person to inspect and tune up your system, which will include checking controls, lubricating moving parts, and making sure no carbon monoxide is leaking.
4. Clear dead leaves - Dead leaves aren’t just unsightly—they’ll also kill your lawn. Rake and bag ’em for removal.

Tip: Mulch leaves in place by running your mower over them and letting the pieces decompose and nourish your lawn all winter.

Lawn maintenance services charge on average $50 to rake leaves. While they’re raking, have them aerate and reseed your lawn so it will green up faster in spring.

5. Clean patio furniture - Before storing your outdoor furniture for the winter, take this opportunity to give them a good cleaning so you don’t have to do it in the spring, at which point the dirt and grime will be way harder to remove.
Tip: Brillo is a great scrubber to remove crud from plastic patio furniture. Just scrub and rinse. Or, train a power washer onto the furniture for a quick clean.
A professional pressure washing costs about 8 cents to 35 cents per square foot. You probably won’t persuade one to clean only your patio furniture, but you can always add this task to a bigger job—such as pressure washing a fence or driveway—for extra productivity points.
6. Secure the home from pests - Critters are just like you: When it’s cold outside, they want to go where it’s warm. “An attic offers a fantastic retreat for rodents like rats and mice to spend the winter,” says Nancy Troyano, director of technical education and training for Rentokil Steritech, a pest control company. But unlike you, mice and snakes can get through a hole the size of a quarter. Don’t let them! Replace all damaged roof tiles and attic vents before it snows, and seal up holes around plumbing pipes and cables that enter your house.
Tip: There really aren’t any shortcuts to patching holes, which you’ll have to cover or fill with something such as wood putty, flexible brick, or concrete caulking. Just make sure you don’t wait too long to make the repairs, because the colder the temperature, the longer the filler will take to cure.
Painters ($25 to $100 an hour) and handymen ($30 to $50 an hour) will patch holes in your home’s exterior.

So, are you prepared for winter after checking off this list? Anything else you'd like to suggest?