The appraisal and the title search are two completely separate processes, although they are both necessary before you can close on a new home or refinance a current one. The appraisal is a detailed assessment of the home's market value, and usually takes only a day or so. The title search is a search for any liens or claims of ownership that could complicate the deal, and it can take anywhere from a day to a few weeks.
When you apply for a mortgage, your lender will order a home appraisal to determine the house's current market value. The lender wants to avoid giving you a mortgage for more than the house is really worth, so the appraiser's job is to assess whether the proposed deal reflects the current value of the property.
A home appraisal and a home inspection are two different things. You can hire a home inspector to look over the house and find any problems that might lead you to reconsider your offer. The appraiser doesn't look for this type of problem. Instead, the appraiser assesses the location, age, condition and special features of the house, factors in any improvements to the property, then compares the proposed mortgage to the selling price of comparable homes in the area.
The appraiser's inspection can take as little as 15 minutes, but may take a few hours if there are a number of factors to consider, including the size and age of the home. After the appraiser compares the house to similar properties, the appraisal report usually takes just a few hours to write up. However, complex cases can take much longer -- weeks or even months, according to the All Area Appraisal Affiliates Network.
The appraisal for a Federal Housing Administration loan is more complex than for a conventional loan, as the appraiser checks for any health or safety concerns as well as for home value. However, it should still take less than a week, according to the FHA Handbook website. The appraisal for a loan from the Veterans Administration takes between 10 and 20 days, because the VA has an extensive list of requirements for all VA-financed homes.
A title examiner can help you find any issue that could affect the proposed deal before it becomes a major problem for you. You don't want to find out at closing that there's a lien on the house, an unpaid tax bill or another person who claims to be the real owner of the property.
You can conduct a title search yourself by going to the county recorder's office, the local courts and the local tax office and asking them for all their records on the property. However, a title search company is in a better position to find all the relevant information.
Title examiners usually offer different packages, depending on your needs and your budget. Most title searches take three business days to complete, according to AFX Research. The chain of title research can take longer, as can any title search in a remote location. Title examiners are usually willing to expedite the search if you're on a deadline, but you may have to pay extra. Call your title search company to find out its policy on rush orders.
- Bank of America: The Home Appraisal Process
- All Area Appraisal Affiliates Network: Frequently Asked Questions
- Coffelt Land Title: Title Search
- Escrow Help: How Long Does a Title Search Take?
- AFX Research: Frequently Asked Questions
- FHA Handbook: How Long Does it Take an FHA Loan to Close?
- Veterans United: 8 Things You Must Know About the VA Appraisal