Castle Appraisal Service, Inc. has answers to "Frequently Asked Questions"
Describe an appraisal
Describe an appraisal(List of questions) The appraisal process is an evaluation that produces an opinion of value. This opinion or estimate is found using a formal method that typically utilizes three "common approaches to value". One of the three is the Cost Approach - which is how much capital would be required to replace the improvements, less physical deterioration and other factors, then adding the land value. Another of the processes is the Sales Comparison Approach - which involves discovering a comparison to other similar nearby properties which have recently sold. The Sales Comparison Approach is normally the most accurate and clearest indicator of a liklely sales price for a home. The Income Approach is generally used for finding the market value of income-producing properties based on what an investor would pay based on the amount of capital a property produce.
Describe what an appraiser does(List of questions) An appraiser offers a fair and credible opinion of market value, to be used in making real estate transactions. Appraisers demonstrate their professional analysis in appraisal reports.
What are the reasons I would need services from Castle Appraisal Service, Inc.?(List of questions) There are a lot of reasons to get an appraisal from Castle Appraisal Service, Inc. with the usual reason being real estate and mortgage transactions. A few other reasons for obtaining an appraisal include:
How is an appraiser different than a home inspector? (List of questions)Appraisers do not do complete house inspections and are not home inspectors. The purpose of a home inspection is to evaluate the structure of the home from bottom to top. The archetypal house inspector's report will contain an evaluation of the condition of the property's heating systems, 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.
Is an appraisal the same as a comparative market analysis(CMA)?(List of questions) Simply put, it's like comparing Shakespeare to reality TV. What the CMA depends on are superficial trends. The appraisal is based on similar proven comparable sales. Also, the appraisal looks at other factors like condition, location and construction prices. The CMA will provide a non-specific figure. An appraisal delivers a defensible and carefully documented opinion of value.
But the largest differentiator is who's behind the report. Real estate agents write CMA's, and they don't always know the whole market or bear specific competence when it comes to home valuation. The appraisal is produce 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, whose income is tied to the value of the home.
What's in an appraisal report? (List of questions)Each report must demonstrate a believable estimate of value and will document the following:
Upon completion of the report, how can I have a guarantee that the value conclusion is accurate?(List of questions) In communicating an appraisal report, each appraiser must make sure of the following:
Who hires Castle Appraisal Service, Inc.(List of questions) Typically, appraisers are called upon by lenders to render a value opinion on a home involved in a loan transaction - to make sure the subject is truly adequate collateral for the loan. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.
Where does an appraiser get the data used to estimate values in Nueces County or other areas?(List of questions) Collecting information is one of the main things an appraiser engages in. Data can be split into Specific or General. Specific data is gathered from the home itself; Location, condition, amenities, size and other specific data are noted by the appraiser while on site.
General data is gathered from a variety of places. Local Multiple Listing Services (MLS) have information on recently sold homes that could be used as comparables. Tax records and other courthouse documents reveal actual sales prices in a market. Flood zone data is available from FEMA data outlets, such as a la mode's InterFlood service.
And most importantly, the appraiser gathers 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?(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 home, 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 commissioning an independent appraisal. For those settling an estate or divorce, an appraisal from Castle Appraisal Service, Inc. is the best documentation to ensure assets are divided fairly. A house is often the single, largest financial asset anybody owns. Without knowing its real value, wise financial decisions are impossible.
What exactly is PMI and how can I get rid of it?(List of questions) PMI stands for Private Mortgage Insurance. This added policy takes care of the lender in case a borrower is unable to pay on the loan and the market price of the house is less than what the borrower still owes on the loan. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.
Should I do anything in advance of the appraisal inspection(List of questions) The first step in most appraisals is the home 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. Is there anything you can do to help? Yes there is! First, be sure we have easy access to the exterior of the house . Trim any shrubs and move any items that would get in our way while we measure the structure. Indoors, make sure the appraiser can get to appliances 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:
Once complete, who actually owns the appraisal report?(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 entitled 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 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.
How can I get the most ROI out of home improvements?(List of questions) Like all things real estate, this is dependent on a home's location. For example, if you live in a cold region, insulated windows can be a real plus. But they aren't as attractive in a warm-weather climate.
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, returning 85%. Adding bedrooms and baths can also boost the value of your home as long as your home doesn't then become atypical for your neighborhood in terms of size.