Wyatt's Real Estate & Appraisal Service has answers to "Frequently Asked Questions"


	Wyatt's Real Estate & Appraisal Service is prepared to reply to any questions you might have about appraisals in Hot Springs and Fall River County. Don't hesitate to contact us today.

What is an appraisal?
What does an appraiser do?
What are the reasons I would need services from Wyatt's Real Estate & Appraisal Service?
How is an appraiser different than a home inspector?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What are the contents of an appraisal report?
Once the report has been delivered, what assurance is there that the value indicated is valid?
What does it mean for an appraiser to be licensed?
Who do appraisers work for?
Where does an appraiser get the information used to estimate values in Fall River County or other areas?
Why should I hire a licensed appraiser?
My mortgage statement has an item on it for PMI? Can I get rid of that?
Do you need anything from the homeowner in advance?
What does "Market Value" mean?
Once complete, who actually owns the appraisal report?
Which home renovations add the most to the price?

What is an appraisal? (Return to top)

The procedure of producing an appraisal deals with an estimation which leads to an opinion of value. There are three "common approaches to value" which assists the real estate appraiser come to this opinion or valuation. One of the processes in use is the Cost Approach, which is what it would cost to restore the improvements to the house, less the depreciation and physical deterioration, plus the land value. Easily the most common approach in finding the value of a home is the Sales Comparison Approach which concerns figuring a comparison to similar properties close by. Being the most common approach, the Sales Comparison Approach is considered the most precise and best indicator of market value for a property. One of the least common approaches in appraising residential properties is the Income Approach, which is commonly used to determine the value of a property based on what an investor would pay based on the capital produced by the property.

What does an appraiser do? (Return to top)

An appraiser provides a fair and credible determination of market value, often in the context of a real estate exchange. Appraisers exhibit their analysis in appraisal reports.

What are the reasons I would need services from Wyatt's Real Estate & Appraisal Service? (Return to top)

There are a lot of reasons to purchase an appraisal from Wyatt's Real Estate & Appraisal Service with the most common reason being real estate and mortgage transactions. Some other reasons for obtaining an appraisal include:

If you are applying for a loan.
To reduce your tax burden.
To build a case for a homeowner's equity and remove insurance.
To challenge improperly assessed property taxes.
To handle an estate.
To offer you an edge when purchasing real estate.
To determine a reasonable price when putting your home on the market.
To protect your rights if your property is being taken by means of eminent domain in a condemnation case.
Government agencies such as the IRS need an appraisal on every home.
It's possible you could have to deal with being in a lawsuit - an appraisal will help.

Click here for a more extensive explanation of the process of getting an appraisal.

How is an appraiser different than a home inspector? (Return to top)

The appraiser is not a home inspector and does not do a comprehensive home inspection. The purpose of a home inspection is to investigate the structure of the property from bottom to attic. The general property inspector's report will include an evaluation of the condition of the house's heating systems, 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.

What is the difference between an appraisal and a comparative market analysis (CMA)? (Return to top)

Frankly, it's apples and oranges. What the CMA relies upon are superficial trends. An appraisal is based on comparable sales that can be verified by records. Location and architectural values are also important in an appraisal. The CMA will provide a non-specific figure. Being a documented and carefully investigated opinion of value, appraisals are defensible and stand up in legal situations.

The person creating the report is hands down the biggest difference between a CMA and an appraisal. A CMA is created by a real estate agent who may or may not be trained in technical valuation concepts or even have a handle on market trends. The appraisal is produce by a licensed, certified professional who has made a career out of valuing properties. Further, the appraiser is an independent party, with no vested interest in the property's value, unlike the real estate agent, whose income is tied to the value of the home.

What are the contents of an appraisal report? (Return to top)

Every report should reflect a believable value opinion and should document the following:

The client and whose purposes the appraisal is to serve.
The intended use of the report.
The purpose of the appraisal.
Precisely what "value" attribute is being reported and what that value means.
The effective date of the appraiser's opinions and conclusions.(Sometimes this is in the past or maybe the future for new construction!)
Relevant property characteristics, including: location, physical attributes, legal attributes, economic attributes, the property rights valued, and non-real estate items included in the appraisal, such as personal property, items that are more or less permanently installed and even intangible considerations.
All known easements, restrictions, encumbrances, leases, reservations, covenants, contracts, declarations, special assessments, ordinances, and the like.
Division of interest, such as fractional interest, physical segment and partial holding.
What was included in the process of completing the appraisal.

For a more comprehensive view of what goes into an appraisal report click here: Sample Appraisal Report

Once the report has been delivered, what assurance is there that the value indicated is valid? (Return to top)

In the documentation of an appraisal, each appraiser must see to it that each of the items below are covered:

That the information analysis implemented in the appraisal was appropriate.

That significant errors of omission or commission were not committed individually or collectively.

That appraisal services were rendered in a careful and judicious fashion.

That a solid, substantiated appraisal report was imparted.

To become a state licensed appraiser, there are intense education requirements as well as on the jobexperience that must be attained - all with the objective of being able to provide unbiased value opinions. Likewise, appraisers must follow a strict industry code of ethics and observe national standards of practice for real estate appraisal. The rules for carrying out an appraisal and documenting its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Return to top) Regulations regarding licensing and certification of Real Estate Appraisers are different from state to state. However, licensing and certification is most often associated with many hours of coursework, tests and experience working under a supervisor. Once an appraiser is licensed, he or she is required to complete continuing education courses in order to keep the license up to date. To see the specific requirements for any state click here.

Who do appraisers work for? (Return to top)

Mortgage lenders are an appraiser's typical customer, using their services to ensure real estate involved in a mortgage transaction is adequate collateral for a loan. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

Where does an appraiser get the information used to estimate values in Fall River County or other areas? (Return to top)

Compiling information is one of the main tasks an appraiser engages in. Data can be described as either Specific or General. Specific data is collected from the home itself; Location, condition, amenities, size and other specifics are noted by the appraiser during an inspection.

General data is gathered from a variety of sources. Local Multiple Listing Services (MLS) provide information on recently sold homes that could be used as comparables. To verify actual sales prices, we look at items in the assessor's office and other public documents. Flood zone data is retrieved from FEMA data outlets, such as a la mode's InterFlood servers.

And last but not least, the appraiser assimilates general data from his or her past experience in creating appraisals for other properties in the same market.

Why should I hire a licensed appraiser? (Return to top)

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 a price that maximizes profit and reduces time on the market. When buying, be sure you're not overpaying by getting an independent appraisal. If you're engaged in an estate settlement or divorce, it ensures that property is divided fairly. Simply put, a home is often the single, largest financial asset anybody owns. Don't make decisions in the dark with a professional appraisal.

My mortgage statement has an item on it for PMI? Can I get rid of that? (Return to top)

PMI is short for for Private Mortgage Insurance. This added policy protects the lender if a borrower doesn't pay on the loan and the value of the property is lower than what is owed on the loan. Once you can prove the amount you owe on your home is less than 80% of the home's market value, you can make a case to your lender to drop the PMI.


	Does your monthly mortgage payment have a lineitem for PMI?Call Wyatt's Real Estate & Appraisal Service today at 6057453140 or send us an e-mail. Documentation of your home's current value could save you thousands.

Do you need anything from the homeowner in advance? (Return to top)

We begin with an inspection of the property. During this process, the appraiser 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. On the home's interior, make sure it is clutter free and that we can get to things like furnaces and water heaters. In the yard, trim any bushes so we can be free to get an accurate measurement of outside walls.

To help expedite our work as well as ensure a more accurate report, try if possible to have the following items:

A plot plan or survey of the house and land (if available).
A list of any personal property that is part of the home and you intend to be sold with the home, such as a oven, or a washer and dryer, if applicable.
A bill for your most recent real estate taxes which should also contain a legal description of the property.
Any inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, septic systems and your well.
Information on "Homeowners Associations" or condominium covenants and fees.

What does "Market Value" mean? (Return to top)

In real estate appraising, Market Value (as opposed to Fair Market Value) is commonly defined as:

"The most probable price (in terms of money) which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: the buyer and seller are typically motivated; both parties are well informed or well advised, and acting in what they consider their best interests; a reasonable time is allowed for exposure in the open market; payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale."

Once complete, who actually owns the appraisal report? (Return to top)

For mortgage transactions, the lender orders the appraisal, either directly or through a third party. 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.

The exception to this rule is when a home owner hires an appraiser directly. In these cases, the appraiser may stipulate the purpose of the appraisal; for PMI removal, or estate planning or tax challenges, for example. If not stated otherwise, the home owner can use the appraisal for any purpose.

Which home renovations add the most to the price? (Return to top)

A home's location - what city it is in and even what part of that city - is key to this popular question. For example, if you're in a neigborhood of small to medium priced homes, a media room may not be something people in that price range want

No matter where you go, however, renovating a kitchen is almost always a safe investment. According to one national survey, kitchen remodels returned an average of 88% of the investment. In other words, a $10,000 kitchen remodeling project would add approximately $8,800 to the value of the home. Bathrooms weren't far behind, yielding 85%. On the contrary, something that may not increase your value would be painting just for the sake of redecorating.