Land appraisal gives an unbiased estimate of the property’s worth. It’s an integral part of the land buying process if you’re targeting buyers who can take out a bank loan and have a good credit check. However, this process is outdated and it takes quite a long time. Luckily, there are more modern and simple solutions for selling land online. This means you don’t have to worry how the client will buy the property — the entire process happens online and it’s simple, fast, and hassle-free. For example, land seller disruptors like SimpleLandSelling, allow people who own properties for which they don’t want to pay taxes for nor invest in upkeep, to sell it easily online directly to land investors for cash. No broker commissions or any additional expenses involved in the selling process, simple as that.
If you’re wondering how long an appraisal takes and why you should shift to direct online land selling, we’ve got the answer!
Who Orders the Appraisal and When?
In most cases, the lender or mortgage company orders the land appraisal. Including the land inspection, the land buyer is the one who’s is paying for it. Depending on the property, an appraiser can charge between $200 and $600 for residential lots but can go up to $3,000 for raw land or farmland of several acres. The bigger the land, the more complex and more expensive the appraisal will be.
On the day of the appraisal, the prospective buyer is typically absent. Although the seller doesn’t have to be there, they frequently send their real estate agent instead. As the appraiser examines the property, the agent will be available to address any queries. You’ll be ready to work with a title firm and close on your new house once the whole process is over.
How Long Does an Appraisal Take?
The total time appraisal depends on the land’s size, its location, and intended use. Usually, the turnaround time is two to four weeks. The process starts immediately after the land seller accepts the buyer’s offer.
First, the mortgage lender orders the appraisal. Then, usually the appraisal procedure starts within one or two days. They will do a walk through the property to inspect it which usually takes a few hours. Next, they will review comps. The comparable properties are an important factor in the appraiser’s valuation. The appraiser compiles the results into an appraisal report, which is usually around ten pages long. The number of comparable properties they are valuing has a significant impact on how long the appraisal takes. Keep in mind that opting for the upgraded way of direct online selling to land investors will save you from long waits.
Why Is It Taking So Long?
While you can expect the appraisal to finish within two to four weeks, not every appraisal will be, within this time frame. This stands especially true in hot markets where lenders might be facing a backlog of mortgage applications as purchasers rush to close on new houses, as well as refinancing applications. There might only be a few free slots for appraisals right now so that they can be finished quickly.
Another big factor contributing to delayed appraisals is the shortage of qualified land appraisers. The industry has been shrinking at a rate of 2.6% a year. And with fewer appraisers to do the work, land buyers have to wait longer for their appraisals to happen. Going through the process of online land selling allows you to avoid the hassle of looking for professional appraisers and potentially waiting for weeks to get the appraisal report.
How to Get the Appraisal Report Back Faster?
While the buyer can’t exactly do much to rush the appraisal, the seller can ensure a smooth process with proper preparation. For instance, they could clean up the property and remove any debris — this can help give the appraiser easier access and valuation.
The other option is to resort to desktop assessments. These provide the same assessment of the value of your property, but they are carried out remotely. In other words, the appraiser never comes to the property. Compared to their conventional equivalents, they provide a land valuation that is quicker and less expensive.
How Long After Appraisal Is Closing?
The closing process usually takes about 60 days. The exact length depends on the buyer’s loan type, the volume of loans and refinances a lender is managing at that time, as well as issues that can occur with the inspection, appraisal, and title search. If the appraisal completion takes two weeks, it might take about 45 days to close on the land.
What Are the Next Steps After the Appraisal?
Once you receive the appraisal report and the appraised value of the land is the same as the buyer’s offer, it means that you’re now a step closer to closing. But what if the value is higher or lower than the offer?
The sale goes through as expected if the appraisal results are above the contract price. However, if the appraisal results are less than the agreed-upon price, the deal may be postponed or canceled. The initial step is to attempt to negotiate with the seller if the appraisal results are less than the current sale price. The ideal scenario is that they will consent to a sale price that is closer to the home’s appraised value, allowing you to finance your home purchase without any issues.
Mortgage underwriting follows the completion of the home appraisal. To ensure that everything is in order and that all necessary documents the buyers present, the underwriter examines the loan file. After evaluating the loan’s risk, the underwriter decides whether to approve or deny the loan based on all available data.
Can One Dispute an Appraisal?
A buyer could dispute the appraisal. It isn’t as straightforward as it would seem, though, and there might be other options. For instance, they could renegotiate the selling price with the seller or withdraw from the transaction without losing any earnest money if there is an appraisal contingency. When deciding to dispute an appraisal, facts are everything. Lenders will only take into account the instances where an appraiser has made a serious error in judgment—typically 2% or more below the asking price—and when that error can be supported by concrete evidence.
How long does an appraisal take depends on multiple factors but the usual timeframe is two to four months. The purchase may be postponed or even abandoned if the appraisal value is lower than anticipated. The simpler and quicker way is to sell it directly to investors for cash — SimpleLandSelling offers top dollar and no commissions or listing fees!