Nathan Wallace Appraisals has answers to "Frequently Asked Questions"


	Nathan Wallace Appraisals is always willing to handle any questions you might have about appraisals in Dothan and Houston County. Contact us today to see how we can help you with your valuation problems.

Describe an appraisal
Describe what an appraiser does
Why would someone need services from Nathan Wallace Appraisals?
How is an appraiser different than a home inspector?
My agent performed a CMA for me. Is that the same as an appraisal?
What can I expect to see in my appraisal report?
Once the appraisal is done, what assurance is there that the value indicated is trustworthy?
What does it mean for an appraiser to be licensed?
Who hires Nathan Wallace Appraisals
Where does an appraiser get the information used to estimate values in Houston County or other areas?
Why should I hire a licensed appraiser?
My mortgage statement has an item on it for PMI? Can I get rid of that?
Should I do anything in advance of the appraisal appointment
What does "Market Value" mean?
Who actually owns the appraisal report?
I want to get more for my house. Where should I spend money renovating?

Describe an appraisal (Go to list of questions)

An appraisal report is an evaluation allowing the appraiser to come to an opinion of value. There are three "common approaches to value" which assists the real estate appraiser arrive at this opinion or valuation. One of the processes in use is the Cost Approach, which is what it would cost to replace the improvements to the home, minus age and physical deterioration, plus the land value. The Sales Comparison Approach deals with searching for similar homes in the vicinity and finding value based on making a comparison of those houses to the house being investigated. Generally speaking, the Sales Comparison Approach is the most accurate indicator of market value of a house. One of the least common approaches in appraising houses is the Income Approach, which is commonly used to determine the value of a property based on what an investor would pay based on the capital produced by the building.

Describe what an appraiser does (Go to list of questions)

An appraiser forumlates a fair and credible determination of market value, often in the context of a real estate sale. Appraisers reveal the details of their analysis in appraisal reports.

Why would someone need services from Nathan Wallace Appraisals? (Go to list of questions)

There are a lot of reasons to purchase an appraisal from Nathan Wallace Appraisals with the most common reason being real estate and mortgage transactions. Some other reasons for ordering an appraisal include:

If you are applying for a loan.
If you would like to lower your property tax obligations.
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 provide you a leg-up when purchasing real estate.
To find an honest sales price when putting your home on the market.
To ensure parties are provided just compensation in eminient domain cases.
Because a government agency such as the IRS requires it.
It's possible you could be involved in a lawsuit - an appraisal will definitely help.

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

How is an appraiser different than a home inspector? (Go to list of questions)

The appraiser is not a home inspector nor does he/she do a complete home inspection. A third-party home inspector will evaluate the structure of the property, from the top to the bottom. Commonly, a home inspection report will explain the amenities and the necessities of the property: air conditioning (weather permitting), electrical functions, the condition of the heating system, the plumbing; then the structural capacity of the home such as the attic, exposed insulation, walls, floors, ceilings, windows, then the foundation, basement and other visible structures.

My agent performed a CMA for me. Is that the same as an appraisal? (Go to list of questions)

Simply, they share nothing in common. The CMA depends on vague market trends. The appraisal depends on specific verifiable comparable sales. Also, the appraisal verifies other factors like condition, location and replacement costs. The CMA will provide a non-specific figure. Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.

But the biggest difference is who's creating the report. Real estate agents produce CMA's, and they don't always know the whole market or bear specific competence when it comes to home valuation. A certified, Alabama licensed professional who bases a career on valuing homes in and around Houston County creates the appraisal. Further, the appraiser is an independent voice, with no vested interest in the value conclusion, unlike the real estate agent, who gets a commission based upon the price of the home.

What can I expect to see in my appraisal report? (Go to list of questions)

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 whose purposes the appraisal is to serve.
The intended use of the report.
The purpose of the assignment.
Precisely what "value" attribute is being reported and what that value means.
The effective date of the appraisal.(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 characteristics, legal attributes, economic factors, the real property interest valued, and non-real estate items included in the appraisal, such as personal property, permanent equipment installations and even intangible items.
All 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 entailed in the process of completing the job.

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

Once the appraisal is done, what assurance is there that the value indicated is trustworthy? (Go to list of questions)

In the documentation of an appraisal, each appraiser must ensure the following:

The appraisal contained a suitable analysis of the data.

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

That appraisal services were delivered in a careful and cognizant fashion.

That a credible, supportable appraisal report was communicated.

To become a state licensed appraiser, we must satisfy intense education and experience requirements that train us to produce an unbiased opinion. Likewise, appraisers must stick to a meticulous industry code of ethics and respect national standards of practice for real estate appraisal. The tenets for carrying out an appraisal and documenting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Go to list of questions) Licensing and certification takes classroom study, tests and experience working under a supervisor. Once licensed, he or she must then take continuing education courses so the license remains up to date. To see the specific requirements for any state click here.

Who hires Nathan Wallace Appraisals (Go to list of questions)

Mortgage lenders are an appraiser's most likely client, requesting their services to ensure real estate involved in a mortgage transaction is enough to cover a loan balance in the case of default. Attorneys and CPAs also retain the services of appraisers for divorce and estate settlements.

Where does an appraiser get the information used to estimate values in Houston County or other areas? (Go to list of questions)

Compiling information is one of the primary activities of an appraiser. Data can be classified as either Specific or General. Specific data is from the home itself; Location, condition, amenities, size and other specific data are gathered by the appraiser during an inspection.

General data is received from a many sources. To research recently sold homes to be used as "comps", we typically go to the local Multiple Listing Service. To double-check actual sales prices, we look at items in the assessor's office and other public documents. Flood zone data is available from FEMA data outlets, such as a la mode's InterFlood system.

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

Why should I hire a licensed appraiser? (Go to list of questions)

An appraisal is a worthwhile whenever your home's value is pertinent to a 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. For people settling an estate or divorce, an appraisal from Nathan Wallace Appraisals is the best way to ensure assets are split up properly. A house is often the single, largest financial asset anybody owns. Without knowing its real value, wise financial decisions are impossible.

My mortgage statement has an item on it for PMI? Can I get rid of that? (Go to list of questions)

PMI is an acronym for Private Mortgage Insurance. It protects the lender if a borrower defaults on the loan and the market price of the house is lower than the loan balance. Once you reach the point where your home's equity plus the amount you've paid is at least 20% of your loan balance, you can have your PMI dropped.


	Is PMI something increasing your monthly house payment?Call Nathan Wallace Appraisals today at 3347902276 or send us an e-mail. Documentation of your home's current value could save you thousands.

Should I do anything in advance of the appraisal appointment (Go to list of questions)

We start with an inspection of the property. 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 the appraiser has easy access to the exterior of the house (gates aren't locked, etc). Trim any landscaping and move any items that would make it difficult to measure the structure. Indoors, make sure the appraiser can easily access appliances 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:

A survey or plot map of the property and building (if readily available).
List of personal property to be sold with the home.
A bill for your most recent real estate taxes which should also contain a legal description of the property.
Brag sheet that lists major home improvements and enhancements, the date of their installation and their cost (for example, the addition of Energy efficiency upgrades or roof repairs) and permit confirmation (if available).
Find copies of the current listing agreement, broker's data sheet and, if the sale is "pending", the purchase agreement.

What does "Market Value" mean? (Go to list of questions)

In real estate appraising, Market Value (as opposed to Fair 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 actually owns the appraisal report? (Go to list of questions)

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 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.

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 stipulated otherwise, the home owner can use the appraisal for any purpose.

I want to get more for my house. Where should I spend money renovating? (Go to list of questions)

Like all things real estate, this is dependent on a home's location. For example, while quality appliances are attractive, a $7000 built-in refrigerator won't pay off in a neighborhood of moderately priced homes

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, yielding 85%. Adding bedrooms and baths can also increase 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.