Homeland Appraisal Service, Inc. has answers to "Frequently Asked Questions"


	Homeland Appraisal Service, Inc. is prepared to elaborate on any questions you might have about appraisals or real estate in Newport News City County. Contact us today to learn how we can help solve your specific valuation problems.

Define the term "Appraisal"
Describe what an appraiser does
What would cause me to require your services?
What is the difference between an appraisal and a home inspection?
Is an appraisal the same as a comparative market analysis(CMA)?
What can I expect to see in my appraisal report?
Upon completion of the appraisal, what guarantee is there that the value indicated is accurate?
What are the requirements to be a certified appraiser?
Who do appraisers work for?
Where does an appraiser get the information used to estimate values in Newport News City County or other areas?
What can a full appraisal do for me?
My mortgage statement has an item on it for PMI? Can I get rid of that?
Do you need anything from me in advance?
Define "Market Value"
Does the appraisal belong to the bank or the consumer?
How can I get the most ROI out of home improvements?

Define the term "Appraisal" (Back to top)

An appraiser performs an estimation that produces an opinion of value. The appraiser will typically use a few "approaches," typically three, to draw up the estimation of market value. One of the processes is the Cost Approach - which is what it would cost to replace the improvements, less physical deterioration and other factors, then adding the land value. Another of the methods is the Sales Comparison Approach - which concerns 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 residential 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 capital produced by the property.

Describe what an appraiser does (Back to top)

An appraiser forumlates a professional, unbiased assessment of market value, often in the context of a real estate purchase. Appraisers exhibit their expert conclusions in appraisal reports.

What would cause me to require your services? (Back to top)

There are a lot of reasons to obtain an appraisal from Homeland Appraisal Service, Inc. with the usual reason being real estate and mortgage transactions. A few other reasons for obtaining an appraisal report include:

If you are applying for a loan.
To lower your tax burden.
To show a homeowner has 30% equity and remove Primary Mortgage Insurance.
To contest high property taxes.
If you need to settle an estate.
To offer you a leg-up when purchasing a home.
To find an honest price when listing your home.
To ensure parties are provided just compensation in eminient domain cases.
Because an official agency such as the IRS requires it.
It's possible you could have to deal with being in a lawsuit - an appraisal will definitely help.

For a more detailed explanation of the appraisal process click here.

What is the difference between an appraisal and a home inspection? (Back to top)

Appraisers do not do complete home inspections and are not home inspectors. An inspection is a third-party evaluation of the accessible structure and mechanical systems of a home, from the top to the bottom. Commonly, a home inspection report will explain the amenities and the requirements of the home: air conditioning (weather permitting), electrical services, the condition of the heating system, the plumbing; then the structural capacity of the home such as the attic, accessible insulation, walls, floors, ceilings, windows, then the foundation, basement and other visible structures.

Is an appraisal the same as a comparative market analysis(CMA)? (Back to top)

To be honest, they share nothing in common. The CMA utilizes market trends to generate most of their business. The appraisal depends on similar valid comparable sales. The appraisal report will also contain area and building prices. The CMA will provide a non-specific figure. An appraisal delivers a defensible and carefully documented opinion of value.

The credentials of the person creating the report is actually the biggest difference between a CMA and an appraisal. Real estate agents produce CMA's, and they don't always know the whole market or have 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 independent voice, with no vested interest in the property's value, unlike the real estate agent, whose income is tied to the price of the home.

What can I expect to see in my appraisal report? (Back to top)

The main point of an appraisal document is to let the reader know the value of the real estate in question, and depending on the scope of the report, you'll usually see the following:

The client and other intended users.
The intended use of the report.
The appraisal's purpose.
The type of value reported and a definition of the value reported.
The effective date of the value opinion.(Sometimes this is in the past or maybe the future for new construction!)
Characteristics of the property that have a bearing on the value, including: location, physical attributes, legal attributes, economic factors, the property rights in question, and non-real estate items included in the valuation, such as personal property, trade fixtures and even intangible items.
Any known easements, restrictions, encumbrances, leases, reservations, covenants, contracts, declarations, special assessments, ordinances, and other items of a similar nature.
Division of interest, such as fractional interest, physical segment and partial holding.
What was included in the activity of completing the assignment.

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

Upon completion of the appraisal, what guarantee is there that the value indicated is accurate? (Back to top)

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

The appraisal used an appropriate analysis of the information.

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

That appraisal services were not rendered in a careless or negligent fashion.

The final appraisal report was transparent, sound and not easily discredited.

To become a state licensed appraiser, there are intense education requirements as well as practical experience that must be logged - all with the end goal of gaining the skills required to render unbiased value opinions. Likewise, appraisers must obey a stringent industry code of ethics and observe national standards of practice for real estate appraisal. The guidelines for developing an appraisal and communicating its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Back to top) Regulations regarding licensing and certification are different from state to state. However, licensing and certification typically translates to many hours of coursework, tests and real world experience. Once an appraiser is licensed, he or she is required to engage in continuing education courses so the license stays up to date. To see the specific requirements for any state click here.

Who do appraisers work for? (Back to top)

Typically, appraisers are employed by mortgage lenders to estimate the value of property involved in a loan transaction - to make sure the house 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 Newport News City County or other areas? (Back to top)

Compiling data is one of the main things an appraiser does. Data can be divided into Specific or General. Specific data is collected from the home itself; Location, condition, amenities, size and other specific data are documented by the appraiser during an inspection.

General data is collected from a many places. To look up recent sales to be used as "comps", an appraiser will often use the local Multiple Listing Service. To verify actual sales prices, we look at tax records and other public documents that are usually online nowadays. Flood zone data is gathered from FEMA data outlets, such as a la mode's InterFlood service.

And most importantly, the appraiser assembles general data from his or her collective knowledge gained from doing assignments for other properties in the same market.

What can a full appraisal do for me? (Back to top)

An appraisal is a worthwhile whenever your home's value is relevant to some financial decision. If you're selling your house, an appraisal will help you determine 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 Homeland Appraisal Service, Inc. is the best documentation to ensure assets are split up fairly. 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? (Back to top)

PMI stands for Private Mortgage Insurance. PMI guards the lender in the event a borrower doesn't pay on the loan and the market price of the property is lower than the balance of 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.


	Has your home value appreciated since you first purchased? Call Homeland Appraisal Service, Inc. today at 757-353-2463. You may be able to save money by removing your Private Mortgage Insurance premium.

Do you need anything from me in advance? (Back to top)

We begin with an inspection of the property. What this entails is the appraiser, after setting up an appointment, personally going through the home - recording the layout of the rooms, taking photos and documenting the general condition of its amenities. On the home's interior, pick up any clutter and make sure we can find our way 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.

The following items, if available, will help your appraiser to provide a more accurate appraisal in a shorter period of time:

A survey or plot map of the property and building (if readily available).
Title policy that describes encroachments or easements.
Any inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, septic systems and your well.
Locate copies of the current listing agreement, broker's data sheet and, if the sale is "pending", the purchase agreement.
A bill for your most recent real estate taxes which should also contain a legal description of the property.

Define "Market Value" (Back to top)

In real estate appraising, 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."

Does the appraisal belong to the bank or the consumer? (Back to top)

For mortgage transactions, the lender orders the appraisal, either directly or through a third party. Even though it's the buyer that eventually pays for the report, the lender is the intended user. The buyer is entitled to a copy of the report - 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 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.

How can I get the most ROI out of home improvements? (Back to top)

The added value of a particular amenity truly depends on the local market. 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 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 weren't far behind, returning 85%. On the contrary, work that may not add value would be painting just for the sake of redecorating.