Gant Real Estate Appraisal Service has answers to "Frequently Asked Questions"


	Gant Real Estate Appraisal Service is always ready to reply to any inquiries you might have about appraisals or real estate in Flagstaff and Coconino County. Contact Gant Real Estate Appraisal Service today to learn how we can help you with your valuation problems.

What is an appraisal?
Describe what an appraiser does
Why would a person require a real estate appraisal?
What is the difference between an appraisal and a home inspection?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What's in an appraisal report?
Once the appraisal has been delivered, what guarantee is there that the value indicated is valid?
How difficult is it to become certified?
Who engages the services of appraisers?
Where does an appraiser get the data used to estimate values in Coconino County or other areas?
Why should I hire a licensed appraiser?
What exactly is PMI and how can I get rid of it?
Should I do anything in advance of the appraisal inspection
What is "Market Value?"
Who actually owns the appraisal report?
Are some home improvements more worthwhile than others?

What is an appraisal? (Go to list of questions)

The process of writing an appraisal consists of an inspection which forms an opinion of value. This opinion or estimate is discerned through a formal process that commonly utilizes three "common approaches to value". One of the processes in use is the Cost Approach, which finds what it would cost to replace the improvements to the property, less the depreciation and physical dilapidation, plus the land value. The most common approach in finding the value of a home is the Sales Comparison Approach which concerns concluding a comparison to comparable properties nearby. Generally speaking, the Sales Comparison Approach is the most definite indicator of market value of a home. The Income Approach is primarily used for figuring out 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 (Go to list of questions)

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

Why would a person require a real estate appraisal? (Go to list of questions)

There are a lot of reasons to purchase an appraisal from Gant Real Estate Appraisal Service with the usual reason being real estate and mortgage transactions. Some other reasons for obtaining an appraisal report include:

To obtain a loan.
To reduce your tax burden.
To show a homeowner has 30% equity and remove Primary Mortgage Insurance.
To challenge inflated property taxes.
If you need to settle an estate.
To provide you a negotiating tool when purchasing real estate.
To determine an honest sales price when listing your home.
To defend your rights if your property is being taken by means of eminent domain in a condemnation case.
Government agencies such as the IRS require an appraisal on every property.
If you ever find yourself in a lawsuit.

Click here for a more extensive explanation of the process of getting an appraisal.

What is the difference between an appraisal and a home inspection? (Go to list of questions)

The appraiser is not a home inspector and does not do a full home inspection. An inspection is a third-party investigation of the accessible structure and mechanical systems of a property, from the roof to the bottom. Usually, a home inspection report will explain the amenities and the requirements of the home: air conditioning (weather permitting), electrical functions, the condition of the heating system, the plumbing; then the structural integrity of the home such as the attic, visible insulation, walls, floors, ceilings, windows, then the foundation, basement and other visible structures.

What is the difference between an appraisal and a comparative market analysis (CMA)? (Go to list of questions)

Honestly, they have nothing in common. What the CMA depends on are vague trends. Appraisals use comparable sales which are valid resources. Area and construction values are also important in an appraisal. All a CMA does is generate a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

But the most significant factor is who's 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. The appraisal is created by a licensed, certified professional who has made a career out of valuing properties. Moreover, the appraiser is an unbiased party, with no vested interest in the property's value, unlike the real estate agent, who gets a commission based upon the price of the home.

What's in an appraisal report? (Go to list of questions)

Each appraisal should reflect a believable estimate of value and should clearly state the following:

The client and other intended users.
The intended use of the appraisal.
The appraisal's purpose.
The type of value contained and a definition of the value reported.
The effective date of the value opinion.
Relevant property characteristics, including: location, physical description, legal attributes, economic attributes, the property rights in question, and non-real estate items included in the valuation, such as personal property, trade fixtures and even intangible items.
All known easements, restrictions, encumbrances, leases, reservations, covenants, contracts, declarations, special assessments, ordinances, and the like.
Division of interest, such as fractional interest, physical segment and partial holding.
What was involved in the process of completing the job.

For a more in depth look at the work that goes into an appraisal report click here: Sample Appraisal Report

Once the appraisal has been delivered, what guarantee is there that the value indicated is valid? (Go to list of questions)

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

That the information analysis contained in the appraisal was proper.

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

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

The final appraisal report was clear, credible and conclusive.

To become a state licensed appraiser, there are education requirements as well as practical experience that must be logged. Likewise, appraisers must obey a meticulous industry code of ethics and comply with national standards of practice for real estate appraisal. The tenets for working up an appraisal and documenting its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Go to list of questions) Licensing and certification requires coursework, tests and practical experience. Once licensed, he/she is required to take continuing education courses so that the license doesn't expire. To see the specific requirements for any state click here.

Who engages the services of appraisers? (Go to list of questions)

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

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

One of the main things an appraiser does is to collect data. Data can be classified as either Specific or General. Specific data is gathered from the property itself; Location, condition, amenities, size and other specifics are gathered by the appraiser while on site.

General data is gathered from a many places. Local Multiple Listing Services (MLS) have information on recently sold homes that could be used as comparables. To double-check actual sales prices, we look at items in the assessor's office and other public documents that are usually online nowadays. Flood zone data is retrieved from FEMA data outlets, such as a la mode's InterFlood system.

And last but not least, the appraiser assembles general data from his or her past experience in doing assignments for other houses in the same market.

Why should I hire a licensed appraiser? (Go to 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. If you're selling your home, an appraisal helps you set the most appropriate price. If you're buying, it makes sure you don't overpay. For parties settling an estate or divorce, an appraisal from Gant Real Estate Appraisal Service is the best documentation to ensure assets are divided properly. A home 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? (Go to list of questions)

PMI is an acronym for Private Mortgage Insurance. This supplementary policy covers the lender if a borrower defaults on the loan and the market price of the house is less than what the borrower still owes on 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 mortgage payment have a lineitem for PMI?Call Gant Real Estate Appraisal Service today at (928) 774-4371 or send us an e-mail. Documentation of your home's present value could save you thousands.

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

We start 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 status of its features. On the home's interior, 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 things 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 readily available).
List of personal property to be sold with the building.
Title policy that lists encroachments or easements.
Brag sheet that lists 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 copy of the current listing agreement and broker's data sheet and Purchase Agreement if a sale is "pending".

What is "Market Value?" (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)

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 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.

It's different when it's the homeowner engaging the appraiser for things outside securing a mortgage. In these scenarios, the appraiser may state how the appraisal can be used; for PMI removal, or estate planning or tax challenges, for example. If not noted otherwise, the home owner can do whatever they want with the appraisal.

Are some home improvements more worthwhile than others? (Go to list of questions)

This really depends on where the home is. For example, if you're in a neigborhood of small to medium priced homes, a media room may not be something people in that price range want

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 were second, returning 85%. Adding bedrooms and baths can also boost 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.