Your property appraisal guide

We might require an independent appraisal when you finance a home purchase or refinance with NewCastle Home Loans. Here's what you need to know about how appraisals work, what they cost, and what to expect.

 

What is a property appraisal?

A property appraisal is a report that shows how much a home is worth. A licensed appraiser inspects the house and writes the report. Lenders need the appraisal to ensure the home's value and condition meet the loan requirements

 

How much does an appraisal cost?

Appraisal fees vary based on the property type, loan program, and location. Here are the main factors that affect the cost:

• Single-family homes have lower appraisal fees. Multi-unit property appraisals cost more because they require additional analysis and reporting.
• Appraisal costs differ for Conventional, FHA, and VA loans.
• Investment property appraisals are more expensive than those for primary residences.

 

 

Who pays for the appraisal?

You, the borrower, are responsible for paying the appraisal fee upfront. The appraiser won't visit the property until payment is received.

 

How do I pay for the appraisal?

After we order the appraisal, you'll receive an email from the appraisal management company with a secure payment link. Here's what to do:

1. Check your email inbox for a message from the Appraisal Management Company.
2. Click the payment link to pay the fee using a credit card.
3. After payment, the appraiser will contact the seller's real estate agent to schedule an appointment.

The Appraisal Management Company will email you a copy of the final report, usually within 7 to 10 business days.

 

How to cancel the appraisal

If you decide to cancel the appraisal, please let us know immediately by emailing processing@newcastle.loans.

 

Do I get a refund if I cancel the appraisal?

Depending on when you cancel, you may qualify for a refund. We must receive your email canceling the appraisal at least 24 hours before the appraiser's scheduled inspection to receive a full refund. Suppose you cancel less than 24 hours before the inspection or after the inspection is complete. In that case, you may receive only a partial or no refund because the appraiser may have already started the work.

 

What if the appraised value is less than the purchase price?

If the appraised value is less than the purchase price, we must base the loan on the lower value.

 

Example:

You agree to buy a home for $300,000 and plan to put 10% down ($30,000), which means a loan amount of $270,000. If the appraised value comes in lower—at $290,000—the lender will adjust the loan amount. Instead of $270,000, the loan will be 90% of $290,000, which is $261,000. In this case, you have three options:

1. Ask the seller to lower the price.
2. Increase the loan amount.
3. Pay the difference yourself.

 

What if I'm refinancing, and the value comes at a low price?

When refinancing, we base your new loan on the appraised value, not the estimated value you provide on your application. Your loan options may change if the appraised value is lower than expected. For example, you may not qualify to remove mortgage insurance or get the cash-out amount you want.