Carter Appraisal Group L.L.C. has answers to "Frequently Asked Questions"
Define the term "Appraisal"
Define the term "Appraisal"(Top) The appraisal process is an evaluation that produces an opinion of value. There are three "common approaches to value" which assists the appraiser arrive at this opinion or valuation. One of them is the Cost Approach - which is how much capital would be required to replace the improvements, less physical deterioration and other factors, plus the land value. Another of the methods is the Sales Comparison Approach - which involves making a comparison to other similar nearby properties which have recently sold. The Sales Comparison Approach is normally the most definitive and clearest indicator of value for a house. The Income Approach is mainly used for figuring out the market value of income-producing properties based on what an investor would pay based on the amount of income a property would bring in.
Describe what an appraiser does(Top) An appraiser offers a professional, unbiased determination of market value, often in the context of a real estate exchange. Appraisers summarize their professional investigation in appraisal reports.
What are the reasons someone would require your services?(Top) There are many reasons to obtain an appraisal from Carter Appraisal Group L.L.C. with the usual reason being real estate and mortgage transactions. Other reasons for obtaining an appraisal report include:
My agent performed a CMA for me. Is that the same as an appraisal?(Top) Honestly, they have nothing in common. The CMA uses market trends to create most of their business. Appraisals use comparable sales which are verifiable resources. Area and architectural prices are also a priority in an appraisal. 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 frankly the most significant difference between a CMA and an appraisal. A CMA is written by a real estate agent who may or may not be trained in technical valuation concepts or even have a handle on market trends. A certified, state licensed professional who bases their livelihood on valuing homes in and around Maricopa County creates the appraisal. Likewise, the agent has something at stake since they get a commission based on the property's selling price - their commission - whereas the appraiser is bound by a code of ethics to collect only a flat fee for work they perform, regardless of their outcome.
Upon completion of the report, how can I have certainty that the value conclusion is accurate?(Top) In communicating an appraisal report, each appraiser must ensure the following:
Who are an appraiser's customers?(Top) Most of the time, appraisers are called upon by lenders to estimate the value of real estate involved in a loan transaction. Attorneys and CPAs also hire appraisers for divorce and estate settlements.
Where does an appraiser get the data used to estimate values in Maricopa County or other areas?(Top) Compiling data is one of the main tasks an appraiser engages in. Data can be classified 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 while on site.
General data is gathered from a numerous places. To look up recently sold homes to be used as "comps", an appraiser will typically go to the local Multiple Listing Service. To verify actual sales prices, we look at items in the assessor's office and other public documents. Appraisers often have 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 product.
And last but not least, the appraiser gathers general data from his or her collective knowledge gained from creating appraisals for other properties in the same market.
How can a licensed appraiser help me?(Top) An appraisal is a worthwhile anytime the value of your home is pertinent to some financial decision. For those selling a home, you'll want to figure out a price that gets you the most profit but doesn't leave your home on the market too long; an appraisal can help with that. If you're buying, it makes sure you don't overpay. If you're engaged in an estate settlement or divorce, it ensures that property is divided fairly. Simply put, 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?(Top) PMI is the common abbreviation for for Private Mortgage Insurance. This supplemental policy guards the lender in the event a borrower is unable to pay on the loan and the market price of the property is less than what the borrower still owes 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 the appraiser need anything from me in advance?(Top) The first step in most appraisals is the property inspection. 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. The best thing you can do to help is make sure we have easy access to the exterior of the house (gates aren't locked, etc). Trim any bushes and move any items that would get in our way while we measure the structure. Indoors, make sure the appraiser can easily access items like furnaces and water heaters.
To help expedite our work as well as ensure a more accurate report, try if possible to have the following items:
What is "Market Value?"(Top) In real estate appraising, Market Value is commonly defined as:
Who has rights to the appraisal report?(Top) For mortgage transactions, the lender requests 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 report - it's usually included with all the other closing documents - but is not entitled to use the report for any other purpose without permission from the lender.
This rule doesn't apply when a home owner engages an appraiser directly. In these scenarios, the appraiser may state how the appraisal can be used; 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.
Which home renovations add the most to the price?(Top) The added value of a particular amenity truly depends on the local market. For example, adding a central air conditioner in to a home in the South may add significant value, while putting one in a home near the Pacific Northwest might not have much impact.
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 were second, yielding 85%. Adding bedrooms and baths can also boost the value of your home (when done well) as long as your home doesn't then become overbuilt for your neighborhood in terms of size.