Significance

• According to Lawrence Yun, chief economist for the National Association of Realtors, faulty appraisals can cause homes to drop substantially in value when measuring them against faulty comparable sales in the area. This means that sellers expecting to sell a home for $200,000 when it only appraises for $180,000 might decide to not sell as opposed to take that large of a loss. This can put a halt to progress in the real estate market due to the importance that the role of appraisals play in home sales.
  
  

Types

• Problems with home appraisals are not limited to properties being undervalued. Appraisal problems can arise with faulty wiring, structural damage, property damage not disclosed by the seller or rezoning in areas. All of these factors must be taken into account by an appraiser and reflected accordingly in their report. Any problem with a property can become a factor in canceling a sale if its impact is a large one.
  
  

Time Frame

• A home appraisal does not take very long to accomplish. However, the time to order an appraisal can take from one to four weeks depending on the back-load in an appraiser's office. Until the appraisal is completed, the transaction cannot move forward. Delays on appraisals will result in delays on closings.