Conlan Appraisal Company has answers to "Frequently Asked Questions"
Describe an appraisal
Describe an appraisal(See list of FAQ's) The appraisal process is an estimation that produces an opinion of value. There are three "common approaches to value" which assists the real estate appraiser arrive at this opinion or valuation. One of the methods in use is the Cost Approach, which finds what it would cost to replace the improvements to the home, less the age and physical deterioration, plus the land value. Another of the processes is the Sales Comparison Approach - which concerns discovering a comparison to other similar properties within a close vicinity which have recently sold. Being the most common approach, the Sales Comparison Approach is considered the most precise and best indicator of market value for a home. The third approach is the Income Approach, which is the best method in appraising income producing properties - it involves estimating what an investor would pay based on the money produced by the property.
Describe what an appraiser does(See list of FAQ's) An appraiser forumlates an impartial and well substantiated assessment of market value, in the support of real property transactions. Appraisers demonstrate their expert investigation in appraisal reports.
Why would I require services from Conlan Appraisal Company?(See list of FAQ's) There are a lot of reasons to get an appraisal with the most common reason being real estate and mortgage transactions. Some other reasons for ordering an report include:
Is an appraisal the same as a home inspection? (See list of FAQ's)The appraiser is not a home inspector nor does he/she do a complete home inspection. A third-party home inspector will evaluate the structure of the house, from the top to the bottom. The stereotypical home inspector's report will include an evaluation of the condition of the property's heating system, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and accessible 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)?(See list of FAQ's) Honestly, they have nothing in common. The CMA relies on indistinct local market trends. The appraisal is reliant on specific valid comparable sales. In addition, the appraisal checks other factors like condition, area and construction prices. The CMA will provide a non-specific figure. An appraisal delivers a defensible and carefully documented opinion of value.
Who's creating the report is hands down the biggest difference between a CMA and an appraisal. Real estate agents, who may not have a complete understanding of valuation methods or the entire market, generate CMA's. A certified, North Carolina licensed professional who bases a career on valuing properties in and around Watauga County creates the appraisal. Further, the appraiser is an independent voice, with no conditional interest in the value conclusion, unlike the agent, who gets a commission based upon the value of the home.
What's in an appraisal report? (See list of FAQ's)The main point of an appraisal document is to provide a value opinion, and depending on the scope of the report, one will customarily see the following:
Once the assignment has been delivered, what guarantee is there that the value indicated is valid?(See list of FAQ's) In communicating an appraisal report, each appraiser must ensure the following:
Who hires Conlan Appraisal Company(See list of FAQ's) Commonly, appraisers are hired by lenders to render a value opinion on a home involved in a loan transaction - to make sure the subject is indeed adequate collateral for the loan. Appraisers also provide opinions for legal settlements, tax matters and investment decisions.
Where does an appraiser get the data used to estimate values in Watauga County or other areas?(See list of FAQ's) Gathering data is one of the primary activities of an appraiser. Data can be classified as either Specific or General. Specific data is taken from the home itself; Location, condition, amenities, size and other specifics are gathered by the appraiser during an inspection.
General data is collected from a variety of places. To find out about recently sold homes to be used as "comps", we often go to the local Multiple Listing Service. To double-check actual sales prices, we use items in the assessor's office and other public documents that are usually online nowadays. Appraisers often need to report when a property is in a flood zone, so 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.
How can a licensed appraiser help me?(See list of FAQ's) An appraisal is a valuable tool whenever the value of your home is relevant to a financial decision. If you're selling your house, an appraisal helps you set a price that maximizes profit and reduces time on the market. If you're buying, it makes sure you don't overpay. For people settling an estate or divorce, an appraisal from Conlan Appraisal Company is the best documentation to ensure assets are divided properly. A house is often the single, largest financial asset anybody owns. Don't make decisions in the dark with a professional appraisal.
What exactly is PMI and how can I get rid of it?(See list of FAQ's) PMI stands for Private Mortgage Insurance. This supplementary policy covers the lender if a borrower is unable to pay on the loan and the value of the property is less 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.
How do I get ready for the appraiser?(See list of FAQ's) The first step in most appraisals is the property 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 . Trim any landscaping and relocate any items that would make it difficult to measure the structure. On the inside, make sure we can easily access items like furnaces and water heaters.
The following items, if available, will help your appraiser to provide a more accurate appraisal in a shorter period of time:
Define "Market Value"(See list of FAQ's) In real estate appraising, Market Value is commonly defined as:
Does the appraisal belong to the bank or the consumer?(See list of FAQ's) In most real estate transactions, the appraisal is ordered by the lender. Even though it's the buyer that eventually pays for the report, the lender is the intended user. The buyer is certainly entitled to a copy of the appraisal - it's usually included 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 define how the appraisal can be used; for PMI removal, or estate planning or tax challenges, for example. If not stipulated otherwise, the home owner can use the appraisal for any purpose.
I want to get more for my house. Where should I spend money renovating?(See list of FAQ's) This really depends on where the home is. For example, putting in an inline humidifier could be nice in arid regions, but completely useless near the coast!
As a rule, the most value returned from renovating a home comes in the kitchen. 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 were second, returning 85%. Adding bedrooms and baths can also help the value of your home (when done well) as long as your home doesn't then become an oddball for your neighborhood in terms of size.