According to Real Estate Wiki (www.realestatewiki.com) a Zestimate is an estimated of fair market value using a proprietary formula by the online website Zillow. It is not an actual appraisal but merely a starting point in determining a home's value and can therefore not be used for the refinancing of a mortgage loan.
Zillow is an online real estate community where homeowners, buyers, sellers, and real estate agents and professionals find and share vital information about homes, for free.
To get a federally guaranteed loan, the Federal Institutions Reform, Recovery and Enforcement Act (FIRREA) requires an appraisal from a professional appraiser.
The industry’s encyclopedia, Real Estate Wiki, defines an Appraisal as:
1. A ''defensible'' and carefully documented opinion of value most commonly derived using recent sales of comparable properties by a licensed, professional appraiser.
2. A statement of value or estimation of the value of a property as of a certain date conducted by a disinterested person with suitable qualifications.
Generally, value for single family properties is based upon a review of recent market activity using sales of comparable properties as a basis and then making value adjustments based upon the comparison of comparable property to the subject property.
