Accurate Appraisal Co. has answers to "Frequently Asked Questions"
Define the term "Appraisal"
Define the term "Appraisal"(Go to list of questions) An appraisal is an investigation leading to an opinion of value. The appraiser will typically use a few "approaches," typically three, to draw up the estimation of market value. One of the processes is the Cost Approach - which is how much capital would be required to replace the improvements, minus physical deterioration and other factors, plus the land value. The Sales Comparison Approach deals with finding similar homes in close proximity and figuring out the value based on making a comparison of those homes to the home being investigated. The Sales Comparison Approach is commonly the most accurate and clearest indicator of a liklely sales price for a home. One of the least common approaches in appraising residential properties is the Income Approach, which is mainly used to figure the value of a property based on what an investor would pay based on the income produced by the building.
What does an appraiser do?(Go to list of questions) An appraiser produces a professional, unbiased opinion of market value, in the support of real estate exchanges. Appraisers demonstrate their professional investigation in appraisal reports.
What would cause me to need services from Accurate Appraisal Co.?(Go to list of questions) There are a lot of reasons to get an appraisal with the usual reason being real estate and mortgage transactions. A few other reasons for getting an appraisal include:
How is an appraisal different than a home inspection? (Go to list of questions)The appraiser is not a home inspector nor does he/she do a complete home inspection. The point of a home inspection is to investigate the structure of the home from basement to attic. The general house inspector's report will include an evaluation of the integrity of the home's heating system, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and visible insulation, walls, ceilings, floors, windows and doors, the foundation, basement, and visible structure.
Is an appraisal the same as a comparative market analysis(CMA)?(Go to list of questions) Honestly, they share nothing in common. What the CMA relies upon are ill-defined trends. Appraisals use comparable sales which are verifiable resources. The appraisal report will also include area and construction values. A CMA delivers a "ball park figure." Being a documented and carefully investigated opinion of value, appraisals are defensible and stand up in legal situations.
The person behind the report is hands down the biggest difference between a CMA and an appraisal. Real estate agents, who may not have a true grasp of valuation methods or the entire market, write CMA's. The appraisal is produce by a licensed, certified professional who has made a career out of valuing properties. Further, the appraiser is an unbiased voice, with no vested interest in the value of a home, unlike the agent, whose income is tied to the value of the home.
What does the appraisal report contain? (Go to list of questions)The main point of an appraisal report is to give a value opinion, and depending on the scope of the report, you'll usually see the following:
Once the assignment has been delivered, what assurance is there that the value indicated is veritable?(Go to list of questions) In the documentation of an appraisal, each appraiser must make sure of the following:
Who engages the services of appraisers?(Go to list of questions) Mortgage lenders are an appraiser's most likely customer, using their services to ensure property involved in a mortgage transaction is adequate collateral for a loan. Attorneys and CPAs also retain the services of appraisers for asset division and estate settlements.
Where does Accurate Appraisal Co. get the data used to estimate values in Muskogee County or other areas?(Go to list of questions) Gathering data is one of the primary tasks an appraiser does. Data can be classified as either Specific or General. Specific data is taken from the property itself; Location, condition, amenities, size and other specific data are noted by the appraiser while on site.
General data is received from a numerous places. To find out about recently sold homes to be used as "comps", an appraiser will typically use the local Multiple Listing Service. To verify actual sales prices, we research items in the assessor's office and other public documents that are usually online nowadays. Appraisers routinely need to report when a property is in a flood zone, and that information is retrieved from a FEMA data outlet such as a la mode's InterFlood service.
And last but not least, the appraiser gathers general data from his or her past experience in creating appraisals for other houses in the same market.
Why do I need a professional appraisal?(Go to list of questions) Any time the value of your home or other real property is being used to make a significant financial decision, an appraisal helps. When selling your house, an appraisal helps you set the most appropriate price. If you're buying, it makes sure you don't overpay. For those settling an estate or divorce, an appraisal from Accurate Appraisal Co. is the best documentation to ensure assets are split up properly. Simply put, a house is often the single, largest financial asset anybody owns. Knowing its true value means you can make wise financial decisions.
My mortgage statement has an item on it for PMI? Can I get rid of that?(Go to list of questions) PMI is the common abbreviation for for Private Mortgage Insurance. It covers the lender if a borrower doesn't pay on the loan and the value of the house is lower than the balance of the loan. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.
Do you need anything from me in advance?(Go to list of questions) The first step in most appraisals is the home inspection. During this process, we will come to your home and measure it, determine the layout of the rooms inside, confirm all aspects of the home's general condition, and take several photos of your house for inclusion in the report. Is there anything you can do to help? Yes there is! First, be sure the appraiser has easy access to the exterior of the house (gates aren't locked, etc). Trim any shrubs and relocate any items that would get in our way while we measure the structure. Indoors, make sure we can easily access appliances like furnaces and water heaters.
To help expedite our work plus ensure a more accurate report, try if possible to have the following items:
Define "Market Value"(Go to list of questions) In real estate appraising, Market Value is commonly defined as:
Once complete, who actually owns the appraisal report?(Go to list of questions) In most real estate transactions, the appraisal is ordered by the lender. While the buyer pays for the report as part of the closing costs, the lender retains the right to use the report or any information contained within. The buyer is entitled to a copy of the appraisal - it's usually bundled with all the other closing documents - but is not allowed to use the report for any other purpose without permission from the lender.
It's different when it's the homeowner hiring the appraiser for things outside securing a mortgage. In these situations, the appraiser may state the purpose of the appraisal; for PMI removal, or estate planning or tax challenges, for example. If not stated otherwise, the home owner can do whatever they want with the appraisal.
How can I get the most ROI out of home improvements?(Go to list of questions) A home's location - what city it is in and even what part of that city - is key to this popular question. For example, putting in an inline humidifier could be nice in arid regions, but completely useless near the coast!
No matter where you go, however, renovating a kitchen is almost always a safe move. One recent study revealed that putting $20,000 into a kitchen remodel would add about $17,500 to the value of the home - or about an 88% return on investment. Bathrooms weren't far behind, returning 85%. On the contrary, work that may not add value would be painting just for the sake of redecorating.