5 reasons not to order a 1004 appraisal

1. If you’re a homeowner and you want to take out a loan, do not order a 1004 appraisal. The best product you can order to get a value range of homes in your area is a desktop appraisal. Loan officers use these everyday to determine if your home is within the value range to make your numbers work.

2. If you don’t know what the value of your home is, but you need a loan, do not order a full appraisal and don’t let the bank order a full appraisal. This is because this type of appraisal is much more expensive than a desktop appraisal and if you’re not sure, there is no reason to pay $100’s of dollars more and give control to your bank to find out this answer.

3. If you owe little money on your home and your credit is good, you may not have to order a full appraisal. In many cases, a drive by appraisal will work or other products. Ask your loan officer if you really need a full 1004 appraisal, if you have good credit and you own much of your home, a full appraisal may not be required.

4. If you are listing your property for sale, don’t order a 1004 appraisal to determine the listing price. Here are two of the best ideas that you can use. Order a desktop appraisal. This is an appraisal that does not require a physical inspection of your home. The appraiser will review data in MLS and in public records and select comparable sales based on this information and the information that you provide. Another option is to ask two or three realtors to provide a market analysis for your home. Get all three and you should have a good idea as to where to start.

5. If you are trying to take out a loan and your home is not in average condition or your home is under construction, do not allow the loan officer to order a 1004 appraisal until you have something in writing that your home can be appraised “as is” and not subject to completing these items. I’ve seen many cases, when the appraisal is ordered when the home is under construction and, for whatever reason, the bank will not lend the money until you’ve completed all of the improvements. Meanwhile your interest rate lock expires and you will be forced to pay $1000’s to keep the same interest rate or start the process all over.