Question by petersruby20: How many appraisals do I need to shop for a mortgage refinance?
If I want to get 2 or 3 offers for a mortgage refinance, do I have to get 2 or 3 appraisals? Or can I get just one, and use that for all 3 banks?
Answer by Caveat Emptor
Appraisals are not done until you actually apply for the loan. If you’re just shopping around for rates and costs, an appraisal is not needed. Rates and costs will depend on your credit/income and the amount being refinanced, not the appraisal. Once you select a lender and actually apply, an appraisal will be ordered by the lender – not by you. It’s only purpose is to determine that the property’s market value is sufficient for the loan amount.
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If your appraisal has been done within the last 6 months by a licensed firm, and is not out of line with the other homes in your neighborhood, then you should be able to use the same appraisal in getting multiple offers. It’s best for YOU to shop around first and know who has the best rates, each bank you visit will pull a credit report on you, pulling the report multiple times will cause your score to decline a few points.
As an appraiser, it is important that you understand that the person or entity that orders the appraisal is the one that owns it. Therefore, if a bank orders an appraisal done on your property, then they own the appraisal, and the actual appraisal report will be delivered to them. (Most banks will give you a copy upon request.)
The appraisal report will have the name of the bank that ordered it on the report. Other lenders can use the information to pre-approve you, but they will need to have their own report with their banks information on it for official purposes.
The easiest way to handle it would be to order a personal appraisal and get all the quotes you want. Then when you decide which company you want to go with, they will order another one. I would check with the mortgage companies first to make sure they will accept a personal appraisal.
As a side note, I would also do the same thing with my credit report, that way multiple companies are not ordering them and possibly lowering your credit score. (Your credit score is not supposed to change if you order it yourself.)