Q. We are planning to refinance our mortgage, but we’re concerned that several refinancing deals and even home sales in our neighborhood have recently fallen out of escrow because their appraisals came in too low for the bank to justify making the loan. What can we do to make sure that our home is appraised at the highest value possible?
A. Several readers like you have been asking similar questions, especially because values in many communities remain far below those of a year or two ago, and lenders — unlike in the past — are now under pressure from regulators to ensure that the properties they finance or refinance today are actually worth the amount that they’re willing to lend.
You can do several things to help ensure that your property appraises at the highest value possible. First, because appraisers check local sale prices when determining how much your own property is worth, it’s wise to contact a local real estate agent before applying for the loan and ask for a list of recent sales in the area. Also ask the agent if any sale prices that seem low may have been caused by unusual circumstances, such as sellers who were willing to offer a cut-rate price because of a divorce or job relocation. Relay that information to the appraiser so he can take it into account when trying to place a value on your own home.
Make sure that you are present when the appraiser visits, and that the house is clean as a whistle. That includes picking up any clutter, vacuuming or steam-cleaning carpets, shining windows and making sure that the yard is mowed and well-manicured. Anything you can do to enhance your home’s curb appeal may add thousands of dollars to the appraiser’s valuation, which, in turn, can make the difference between getting the loan or getting denied.
It also helps to type up a list of your home’s special attributes and give it to the appraiser when he arrives. Appraisers today are extremely busy, so they might not notice your special woodwork, the energy-saving windows you recently installed or your brand-new dishwasher unless you point the improvements out to him. Make sure the list also includes any other special features of the property, such as an extra-large lot, great views of the mountains or water or whether the neighborhood is served by outstanding public schools.
If all of your efforts don’t raise the appraisal high enough to justify the loan, contact the bank and ask for a copy of the document: You paid for it and federal law requires that the lender send you one upon request. Look for errors on the report — the most common include an underestimation of the square footage of the home or size of the lot — and then call the appraiser directly to recheck his work. If he refuses to raise the appraised amount, call your state’s appraisal board, real estate commission and other regulators for further help.
You also should plead your case directly to the bank. Most lenders still have an “appraisal review” process for those who can’t get a loan because the house was undervalued by an appraiser, even though new federal regulations prevent them from directly meddling with an appraiser’s initial conclusion of the property’s value.
Q. We signed a one-year lease for a house in May of last year, and part of the lease specifically gave my wife and I use of the home’s two-car carport. The lease expired a few months ago, and now we are renting the place on a month-to-month basis. Lately, the owner began parking his camper in one of the two slots in the carport without asking our permission, which forces either my wife or me to park one of our cars on the street. Are we still entitled to have both spaces in the carport, even though the lease has expired?
A. Yes, you probably still have the right to use both spaces. Though rental laws vary from one area to the next, most jurisdictions require the terms of an expired lease to be “held over” when a tenancy converts to a month-to-month basis because no new lease is signed. This means that until terms of the tenancy are formally changed, all of the rights you had under the original lease (including the use of both parking spots) remain intact.
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