BRIGMAN APPRAISAL SERVICE has answers to "Frequently Asked Questions"
What is an appraisal?
What is an appraisal?(List of questions) The appraisal process is an evaluation that produces an opinion of value. This opinion or estimate is concluded by a formal process that commonly utilizes the three main "common approaches to value". The Cost Approach is one of the approaches that real estate appraisers use to find value; it involves figuring what the improvements would cost minus physical depreciation, adding the land value. The Sales Comparison Approach deals with searching for comparable properties in the vicinity and discerning value based on making a comparison of those properties to the house in question. Being the most popular approach, the Sales Comparison Approach tends to be the most accurate and best indicator of market value for a property. The third approach is the Income Approach, which is of most importance in appraising income producing properties - it deals with estimating what an investor would pay based on the income produced by the property.
What does an appraiser do?(List of questions) An appraiser forumlates a professional, unbiased opinion of market value, to be used in making real estate transactions. Appraisers document their expert investigation in appraisal reports.
What are the reasons I would need your services?(List of questions) There are a lot of reasons to obtain an appraisal from BRIGMAN APPRAISAL SERVICE with the most common reason being real estate and mortgage transactions. Some other reasons for obtaining an appraisal report include:
Is an appraisal the same as a home inspection? (List of questions)The appraiser is not a home inspector and does not do a comprehensive home inspection. A third-party home inspector will inspect the structure of the home, from the roof to the foundation. The general property inspector's report will include an evaluation of the condition of the house'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.
My agent performed a CMA for me. Is that the same as an appraisal?(List of questions) Frankly, they have nothing in common. The CMA depends on indistinct trends in the market. Appraisals use comparable sales which are valid resources. Area and architectural costs are also precedent in an appraisal. All a CMA does is generate a "ball park figure." Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.
But the largest differentiator is who's behind the report. A CMA is written by a real estate agent who may or may not have a true grasp of the market or valuation concepts. The appraisal is created by a licensed, certified professional who makes a living out of valuing properties. Moreover, the appraiser is an unbiased party, with no conditional interest in the value of a home, unlike the real estate agent, who gets a commission based upon the value of the home.
What's in an appraisal report? (List of questions)Every report should indicate a supported estimate of value and will identify the following:
Once the appraisal is done, what guarantee is there that the final number is veritable?(List of questions) In communicating an appraisal report, each appraiser must ensure the following:
Who engages the services of appraisers?(List of questions) Commonly, appraisers are called upon by mortgage lenders to estimate the value of real estate involved in a loan transaction - to make sure the real estate is truly adequate collateral for the loan. Appraisers also provide opinions for legal settlements, tax matters and investment decisions.
Where does an appraiser get the information used to estimate values in Racine County or other areas?(List of questions) One of the primary things an appraiser does is to collect data. Data can be divided into Specific or General. Specific data is taken from the property itself; Location, condition, amenities, size and other specific data are noted by the appraiser during an inspection.
General data is collected from a variety of places. Local Multiple Listing Services (MLS) have information on recently sold homes that might be used as comparables. To double-check actual sales prices, we look at tax records and other public documents that are usually online nowadays. Appraisers often have to report when a property lies in a flood zone, and that information is retrieved from a FEMA data outlet such as a la mode's InterFlood service.
And most importantly, the appraiser assembles general data from his or her collective knowledge gained from creating appraisals for other properties in the same market.
What can a full appraisal do for me?(List of questions) An appraisal is a worthwhile whenever the value of your home is relevant to a financial decision. For those selling a home, you'll want to figure out the price that gets you the most profit but doesn't leave your home on the market too long; an appraisal can help with that. When buying, be sure you're not overpaying by getting an independent appraisal. For parties settling an estate or divorce, an appraisal from BRIGMAN APPRAISAL SERVICE is the best way to ensure assets are divided properly. A home 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?(List of questions) PMI is an acronym for Private Mortgage Insurance. This added policy guards the lender in case a borrower is unable to pay on the loan and the market price of the property is less than the loan balance. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.
Does the appraiser need anything from the homeowner in advance?(List of questions) We begin with an inspection of the home. 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. 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 shrubs and relocate any items that would get in our way while we measure the structure. On the inside, make sure the appraiser can get to items like furnaces and water heaters.
You can make things go faster and improve the accuracy of the appraisal report by having the following things on hand:
What does "Market Value" mean?(List of questions) In real estate appraising, Market Value (as opposed to Fair Market Value) is commonly defined as:
Who has rights to the appraisal report?(List of questions) 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 appraisal - it's usually bundled with all the other closing documents - but is not entitled 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 scenarios, 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.
Are some home improvements more worthwhile than others?(List of questions) This really depends on where the home is. For example, while quality appliances are attractive, a $7000 built-in refrigerator won't pay off in a neighborhood of moderately priced homes
As a rule, the best ROI from renovating a home comes in the kitchen. 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 are right up there with kitchens, returning 85%. On the contrary, work that may not add value would be painting just for the sake of redecorating.