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Appraised Value:
The Ups & Downs Of How Much A House Is Worth.
Determining Fair Market Value is an eternal struggle and major balancing act. That’s because buyers want a house to appraise on the low side-to keep the purchase price down. While sellers want the same house to appraise on the high side-to make the sale price higher. And then you’ve got the owners of the house-who also want the appraisal to be on the low side , in order to keep the property taxes down.
So with all these different agendas and points of view, how is the fair market value of a real estate property actually determined?
Once a year, your county sends all area homeowners official notices that put a dollar value on their property. And property taxes are based on those dollar values. But before those notices get sent out, a long , detailed process usually takes place. First, the land is valued as if it’s vacant-an empty lot, in other words. Then any improvements are described and measured. Improvements consist of the house and any other structures, pools , sheds, garages, and so forth. Next, most counties check the Marshall Valuation Service Cost Guide. It’s a standardized nationwide guide for determining the value of the cost per square foot to build a building that fits the description of the improved property. Next , if the house isn’t brand new, the replacement cost is considered, as well as depreciation; the year the house was constructed and the condition of the property are factors here. Appraisers then must take the critical step of comparing the value of the house with recent selling prices of similar homes in the neighborhood. At this point, the appraisal might stand “as is”-or it might be adjusted upward or downward.
Market Value is a theory , in other words-not an unchanging fact.
In a perfect world, you have to have willing buyer and a willing seller. Neither is under duress. Both are in a position to maximize gain and are trying to do this. But in the real world, things are rarely that simple and equally balanced. Which is why people feel differently about the appraisal value of a house. It really depends how strong their position is as a buyer or seller.
Does the local economy come into it at all? You bet it does.
Ask a successful Realtor about that! He or she will tell you they’ve noticed that the Rio Grande Valley’s fast-growing economy is attracting people from other areas who consider real estate here a bargain. That helps fuel increases in property values.
So-now you know where that Grand Total comes from.
You’re armed with the information you need to make a better house-buying decision. For instance, you can understand how two virtually identical houses that are in two different neighborhoods could be very far apart in price and appraised value. And why your choice of the right house in the right neighborhood could be worth a not-so-small fortune to you right now-and years down the road.
McAllen Homes for Sale & McAllen Foreclosures
It is almost like a dream come true. After working very hard at your business , you get a huge purchase order from one of your best customers. You can almost feel the sweet taste of success. Soon, however, reality sets in. If you are like most small to mid size businesses, you realize that you don聮t have enough money to buy supplies because your suppliers are demanding advance payment. You now risk losing the order unless you find a way to finance it.
If your company has been in business for many years , is reasonably big and has a great track record, you will probable be able to get a business line of credit or a similar type of bank financing. If that is the case, you聮ll be able to borrow money to pay your suppliers and fulfill the order. But what options do you have if you are a new business owner or if you run a small business that has no bank credit?
There is a little known and seldom used financing product that could help you in this situation. As a matter of fact, it could help you almost any time you have a big sale to a good credit worthy customer. It is called purchase order financing (also known as purchase order funding or PO funding).
Purchase order funding can provide you with the financing you need to fulfill orders from your large and best credit worthy clients. As opposed to most financial products , the only collateral that purchase order financing requires is the actual purchase order (and associated payments) from your client. The financing company will provide you with the necessary capital to fulfill and deliver the order. They get paid when the client pays for the order. This makes it an ideal product for small and mid size businesses who are growing quickly and need capital to deliver orders to their ever growing client list.
Who qualifies for purchase order funding?
Purchase order funding is ideal for companies that re-sell a finished product at a profit. For example, import-export companies, wholesalers and distributors can certainly use this type of financing. However, if your company buys a product and modifies it before re-selling it , most probably it will not qualify for this type of financing (there are exceptions).
Although purchase order financing can be affordable if your profit margins are right, unfortunately it does not come cheap. This is because most financing companies consider the transaction to be high risk. The total cost of the transaction, from start to finish, can be anywhere between 5%. |
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