Appraisals Unlimited, LLC ~ "Making Real Estate Real Easy, Since 1991!" has answers to "Frequently Asked Questions"

Appraisals Unlimited, LLC ~ "Making Real Estate Real Easy, Since 1991!" is always eager to elaborate on any concerns you might have about appraisals in Volusia County. Contact Appraisals Unlimited, LLC ~ "Making Real Estate Real Easy, Since 1991!" today to see how we can help solve your specific valuation problems.

What is an appraisal?
What does an appraiser do?
What would cause me to need your services?
How is an appraisal different than a home inspection?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What does the appraisal report contain?
Upon completion of the appraisal, what guarantee is there that the value conclusion is veritable?
How difficult is it to become certified?
Who engages the services of appraisers?
Where does Appraisals Unlimited, LLC ~ "Making Real Estate Real Easy, Since 1991!" get the data used to estimate values in Volusia County or other areas?
Why do I need a professional appraisal?
My mortgage statement has an item on it for PMI? Can I get rid of that?
Does the appraiser need anything from the homeowner in advance?
Define "Market Value"
Who has rights to the appraisal report?
How can I get the most ROI out of home improvements?



What is an appraisal?   (Return to top)

The procedure of producing an appraisal report deals with an evaluation which leads to an opinion of value. The appraiser must use a several "approaches," typically three, to come to the estimation of market value. The Cost Approach is one of the methods that real estate appraisers use to find value; it involves finding what the improvements would cost minus physical deterioration, adding the land value. Another of the processes is the Sales Comparison Approach - which deals with finding a comparable analysis to other similar properties within a close vicinity which have recently sold. Usually, the Sales Comparison Approach is the most accurate indicator of market value of a home. One of the least common approaches in appraising residential properties is the Income Approach, which is commonly used to figure the value of a property based on what an investor would pay based on the income produced by the building.

What does an appraiser do?   (Return to top)

An appraiser generates a fair and credible assessment of market value, to be used in making real estate transactions. Appraisers exhibit their expert investigation in appraisal reports.


What would cause me to need your services?   (Return to top)

There are many reasons to order an appraisal with the most common reason being real estate and mortgage transactions. A few other reasons for getting an appraisal include:
  • To get a loan.
  • To lower your property taxes.
  • To help a homeowner realize if they owe less than 80% of their home's value and remove insurance.
  • To challenge inflated property taxes.
  • To handle an estate.
  • To offer you an edge when purchasing real estate.
  • To determine an honest price when putting your home on the market.
  • 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 help.
If you need more information about the appraisal process, please click here.


How is an appraisal different than a home inspection?   (Return to top)

Appraisers do not do provide home inspections and are not home inspectors. A third-party home inspector will investigate the structure of the home, from the top to the foundation. The standard house inspector's report will contain an evaluation of the integrity of the property's heating systems, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and visible 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)?   (Return to top)

Frankly, it's night and day. The CMA depends on vague trends in the market. The appraisal relies on similar definite comparable sales. Area and architectural prices are also important in an appraisal. A CMA delivers a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

But the biggest difference is the person doing the report. Real estate agents write CMA's, and they don't always know the whole market or have specific competence when it comes to home valuation. A certified, Florida licensed professional who made a career on valuing homes in and around Volusia County creates the appraisal. Likewise, the agent has something at stake since they get a commission based on the property's selling price whereas the appraiser is bound by a code of ethics to collect only a flat sum for work they perform, regardless of their outcome.

What does the appraisal report contain?   (Return to top)

Each appraisal must indicate a credible value opinion and will document the following:
  • The client and other intended users.
  • How the appraisal is supposed to be used.
  • The appraisal's purpose.
  • Precisely what "value" attribute is being reported and what that value means.
  • The effective date of the value opinion.(Sometimes this is in the past or maybe the future for new construction!)
  • Pertinent property characteristics, including: location, physical characteristics, legal attributes, economic attributes, the property rights valued, and non-real estate items included in the appraisal, 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 involved in the process of completing the assignment.
For a more comprehensive look at 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 conclusion is veritable?   (Return to top)

In communicating an appraisal report, each appraiser must make sure of the following:
  • That the information analysis utilized in the appraisal was proper.

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

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

  • The final appraisal report was clear, credible and defensible.
There are rigorous education and experience requirements that must be fulfilled in order to get an appraisal license in Florida. In addition, appraisers must abide by a stringent industry code of ethics and observe national standards of practice for real estate appraisal. The rules for working up an appraisal and documenting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


   (Return to top) Regulations regarding licensing and certification of Real Estate Appraisers vary from state to state. However, licensing and certification is commonly associated with many hours of coursework, tests and practical experience. Once an appraiser is licensed, he or she is required to complete continuing education courses in order to keep the license current. To see the specific requirements for any state click here.

Who engages the services of appraisers?   (Return to top)

Most of the time, appraisers are called upon by lenders to render a value opinion on real estate involved in a loan transaction. Appraisers also provide opinions for legal settlements, tax matters and investment decisions.

Where does Appraisals Unlimited, LLC ~ "Making Real Estate Real Easy, Since 1991!" get the data used to estimate values in Volusia County or other areas?   (Return to top)

One of the most important things an appraiser does is to collect property data. Data can be described as either Specific or General. Specific data is taken from the home itself; Location, condition, amenities, size and other specific data are noted by the appraiser while on site.

General data is collected from a number of sources. To research recent sales to be used as "comps", we often go to the local Multiple Listing Service. Tax records and other public documents verify actual sales prices in a market. Appraisers routinely 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 service.

And last but not least, the appraiser assimilates general data from his or her collective knowledge gained from doing assignments for other properties in the same market.


Why do I need a professional appraisal?   (Return to top)

Any time the value of your home or other real property is being used to make a significant financial decision, an appraisal helps. For those selling a home, you'll want to figure out a price that gets you the most profit but also ensures you don't have to wait too long for a buyer to show up; an appraisal can help with that. If you're buying, it makes sure you don't overpay. For those settling an estate or divorce, an appraisal from Appraisals Unlimited, LLC ~ "Making Real Estate Real Easy, Since 1991!" is the best documentation to ensure assets are split up properly. Simply put, 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?   (Return to top)

PMI is the common abbreviation for for Private Mortgage Insurance. PMI takes care of the lender in the event a borrower defaults on the loan and the market price of the home is less 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.

Does your monthly loan payment have a lineitem for PMI?Call Appraisals Unlimited, LLC ~ "Making Real Estate Real Easy, Since 1991!" today at 386-212-8686 or send us an e-mail. Documentation of your home's current value could save you thousands.

Does the appraiser need anything from the homeowner in advance?   (Return to top)

We begin with an inspection of the home. 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 status of its amenities. Inside, pick up any clutter and make sure we can access things like furnaces and water heaters. On the outside, trim any landscaping so we can be free to get an accurate measurement of exterior walls.

You can make our visit go faster and improve the quality of the appraisal report by having the following things on hand:
  • A plot plan or survey of the house and land (if available).
  • A list of any personal property that will be left behind and sold with the home, such as an oven, or a washer and dryer, if applicable.
  • Home inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, your septic system and your well.
  • A list of any major home improvements and upgrades, the amount of their purchase and date of their installation (for example, the addition of central air conditioning or roof repairs) and permit confirmation (if available).
  • A list of "proposed" improvements if the property is to be appraised "as complete".

Define "Market Value"   (Return 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."



Who has rights to the appraisal report?   (Return to top)

For mortgage transactions, the lender requests 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 certainly entitled to a copy of the report - 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.

This rule doesn't apply when a home owner engages an appraiser directly. In these cases, the appraiser may define 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.


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

It really depends on the 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.

As a rule, the most value returned 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 weren't far behind, 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.