If you are in the process of purchasing a home in Illinois with financing, getting a professional appraisal completed on the property is a standard requirement. But exactly how long does an appraisal process take from start to finish?
How Long Does a Home Appraisal Take?
A typical home appraisal in Illinois takes about 5 to 15 business days in total, including scheduling the appraiser, on-site inspection, preparing the appraisal report, and lender review. The on-site inspection itself typically takes 1-2 hours. Delays or appeals may extend the timeline.
The appraisal is ordered by the lender after a buyer’s loan application is submitted and under review, typically within 2-3 weeks. This allows time for initial application scrutiny before appraisal costs are incurred.
The appraisal itself includes inspection, research, and report submission, followed by a lender review for final approval.
After appraisal, the closing process on a house usually takes 2-3 weeks. This period allows for appraisal review, underwriting, preparation of closing documents, and scheduling coordination among all parties involved.
However, the timeline can extend up to 45 days, depending on various factors like the type of loan and the efficiency of the lender.
Home Appraisal Process Timeline
The home appraisal process timeline involves five steps: ordering and scheduling the appraiser by the lender (2-7 days), conducting the on-site inspection (1-2 hours), preparing the detailed appraisal report (2-5 days), appraisal review by the lender (1-5 days), and handling the appraisal value outcome. The timeline can vary, especially if the appraisal value is lower than the offer price, necessitating negotiations or reconsideration of value.
1. Ordering and Scheduling of the Home Appraiser by the Lender (2-7 Days)
- For purchase transactions, the buyer’s mortgage lender is responsible for selecting, ordering and scheduling the appraisal.
- The lender maintains an approved appraiser list and will choose one who is licensed in the home’s geographic area.
- It takes approximately 2-3 days for the lender to connect with the appraiser, provide property details, and confirm an inspection date/time.
- The appraiser will call the buyer a day before with an estimated inspection window – typically a 2-4 hour block of time.
2. Conducting the On-Site Inspection (1-2 hours)
- On the day of appraisal, the appraiser will complete a thorough walkthrough of the interior to document the bedroom/bathroom count, measure all rooms, photograph fixtures, and assess the overall condition.
- For single-family homes, the appraiser is generally on-site inspecting for 1-2 hours, depending on size and other factors.
- The exterior inspection involves measuring the full property, photographing all sides of the home, and checking utilities, detached structures, landscaping, and general exterior condition.
3. Preparing the Detailed Appraisal Report (2-5 Days)
- After thoroughly inspecting the home and property, the appraiser needs 2-5 business days to analyze recent sales of comparable properties in your neighborhood and area that have sold within the past 6 months.
- They use this market data along with their inspection findings to run valuation calculations and complete the detailed appraisal report.
4. Appraisal Review Period by Lender (5-10 Days)
- Once the appraiser submits the completed report to your mortgage lender, the lender requires 5-10 business days to carefully review the appraisal, assess the appraiser’s value determination, and follow up on any concerns or outstanding questions with the appraiser before issuing final approval.
- For FHA and VA loans, the appraisal review process by the lender may take slightly longer, depending on certain program guidelines.
4. a. What happens if Appraisal is Same as the offer?
It is possible for the appraisal to come back exactly matching the agreed-upon purchase price in the contract.
When this occurs, it’s the smoothest scenario since the value is validated, and there is no price gap to address. The buyer can proceed confidently with financing, knowing the home is appraised for the contracted amount.
4. b. What happens if Appraisal is Higher than the offer?
If the appraisal comes back higher than the buyer’s accepted offer amount, this puts the buyer in an equity position right out of the gate.
Buyers are effectively buying the home below fair market value based on the appraisal and can use the appraised amount as leverage when applying for financing. If requested, the lender can base the mortgage loan amount on the higher appraised value.
4. c. What happens if Appraisal is Lower than the offer?
This is a common and potentially problematic scenario. If the appraisal is lower than your offer, you can appeal the appraisal, request a price reduction from the seller, negotiate a compromise, walk away from the deal, or cover the extra cost yourself. Each option has pros and cons, and timings may vary depending on the choices made.
Here are the options buyers have if the appraisal is lower than the contract price:
I. Request Reconsideration of Value (1-2 Weeks)
You can appeal the appraisal and ask the appraiser to revisit their valuation based on additional comparable sales data or clarification on property features that justify a higher amount. This adds 1-2 weeks if successful.
II. Ask for Price Reduction
You can request the seller lower the agreed upon purchase price to align with appraisal. But sellers are not obligated to drop the price, unless the contract expressly provides for this.
III. Meet in the Middle
The buyer and seller may compromise by mutually agreeing to lower the price somewhat from the original offer amount but not all the way down to the appraisal.
IV. Walk Away
If the seller refuses to lower the price and a valuation gap remains, you can terminate the deal and have earnest money returned, typically within 5 days of receiving the appraisal.
V. Pay the difference out of pocket
You can pay the difference between the final appraised value and the purchase price out of your own pocket. This is not ideal, as it can be a significant financial burden, but it may be the only remaining option if you’re determined to purchase the property.
As you can see, between scheduling, the inspection itself, writing the report, lender review, and any appeals, the typical residential appraisal timeline spans approximately 10 to 25 business days from start to finish, barring any appeals or delays. In case of appeals, the appraisal timeline can extend up to 25 to 35 business days.
However, the precise timing can vary based on lender requirements, licensed real estate appraiser availability, appeals, and other factors.
Learn how long it takes to close on a house in Illinois, from putting an offer on a house to moving in.
In Illinois, appraisal fees often range from $350-$500 for standard single family homes depending on the county, size of home, and complexity involved. Appraisal fees are slightly higher in metro Chicago areas. For larger luxury homes or rural properties, fees can range from $500-$1,000 or more.
To determine your house’s worth, consider factors like location, property type, size, number of bedrooms/bathrooms, age, condition, materials used, special features, and land value.
Use a local real estate agent’s comparative market analysis (CMA) or a licensed appraiser’s report for accurate valuation. Online estimators can provide a ballpark figure but may lack local insight.
To price your house for sale, follow these steps: use online home value estimation tools, conduct a comparative market analysis, explore sold, pending, and withdrawn listings, employ proven pricing tactics, understand the real estate market, learn price adjustment strategies, and enhance the value of your house through decluttering, staging, and cleaning.
Consider consulting a local real estate professional for an accurate assessment.
What Are The Appraisal Disclosure Requirements?
(205 ILCS 635/5-11) of Illinois real estate law requires lenders to provide borrowers with a copy of any appraisal report used to approve their loan. This must be provided promptly upon completion.For FHA loans in IL, appraisals are valid for 120 days.
What Documents To Give To An Appraiser For Real Estate?
Here’s a list of documents and details you, as a potential homebuyer, may provide to an appraiser:
- The signed purchase agreement for the house you’re buying.
- A list of personal property that’s being sold with the house. If certain appliances or furniture are included in the sale, these can sometimes affect the appraisal.
- Any information you have about the age of the house and major systems (like HVAC, electrical, and plumbing), if available.
- Details about any significant upgrades or renovations done to the property. Receipts or documentation are even better if you can get them from the seller.
- Recent home inspection reports done on the home.
- Property tax documents.
- Floor plans or surveys, if available.
- If available, information about any homeowners association (HOA) fees or rules.
- Your own research on recent comparable sales in the neighborhood. While the appraiser will do their own research, they might find your information useful.
- Any known issues with the property that could affect its value.
- Information about what other properties you considered before making an offer on this one.
Remember, as a buyer, it’s not your responsibility to appraise the home, but providing this information can help ensure a more accurate evaluation.
Tips for Expediting the Home Appraisal Process
If hoping to expedite the home appraisal timeline, here are a few tips for buyers in Illinois:
- Ask sellers to provide unencumbered property access to the appraiser – attic, roof, crawlspaces, electrical panels, yard, etc.
- Request sellers to have past inspection reports, renovation receipts, and floor plans handy for the appraiser to review
- Ask sellers to clean the home and make cosmetic improvements like painting before the inspection
- Highlight any recent upgrades, repairs or improvements made to maximize value
- Provide the appraiser with comparable sales data supporting your offer price.
- Be flexible on inspection scheduling – expanded weekday and weekend availability speeds timing
Having a streamlined appraisal process relies heavily on the appraiser’s experience and preparing properly for their inspection visit.
It also helps significantly to communicate expected closing timeframes and dates with your appraiser early on so they can meet critical turnaround times. Build in some extra buffer as well when budgeting your timelines. With proper planning and an experienced appraiser, buyers can expect an appraisal process to take no more than 2-3 weeks.