If you pay for an appraisal before listing your home, it is reasonable to wonder whether the buyer’s lender can use it too. Do not count on your report replacing the lender’s valuation. When Fannie Mae’s appraisal requirements apply, the lender cannot use an appraisal ordered by the seller. Other loan programs have their own requirements, so the buyer should ask their lender what is needed.
That does not make a seller’s appraisal pointless. It answers a different question at a different stage: what does the market evidence suggest about your home as you decide on an asking price?
Why the lender makes its own decision
Under Fannie Mae’s appraiser selection requirements, the lender is responsible for selecting the appraiser and cannot use an appraisal ordered or received by the borrower or another interested party, including the seller. A well-supported seller report does not change that ordering restriction.
A buyer’s lender may need a new appraisal, or it may use another way to check the home’s value. The requirements depend on the loan and the lender. A seller’s appraisal therefore does not mean there will necessarily be two appraisals, and it is not a promise that the buyer will avoid a separate valuation expense.
What the seller’s report helps you decide
A pre-listing appraisal gives you an independent opinion of value for a stated date, supported by an examination of the property and relevant sales. You can use that information alongside other considerations when choosing an asking price. The report is information for your decision, not a guarantee of the eventual sale price or a later lender’s valuation.
For example, Northern Colorado has both detached and attached homes. If you own a detached home, a nearby attached-home sale is not necessarily as useful a comparison as another sale simply because it is close by. The appraiser considers the home’s characteristics, condition, site and comparable sales when developing the value opinion. That gives you more to consider than a list of nearby prices alone.
KTS Appraisal Services provides independent pre-listing appraisals for Northern Colorado homeowners. The family-owned residential firm has served the region for more than 35 years.
Decide what you need before you order
If your main goal is to avoid the buyer’s lender process, ask the buyer to check with their lender rather than assuming your report will replace it. If you want an independent valuation to inform your own pricing decision, contact KTS and explain your property and when you plan to list. You can discuss whether a pre-listing appraisal fits your needs before deciding to order.