Park Place Appraisals, LLC has answers to "Frequently Asked Questions"


	Park Place Appraisals, LLC is more than happy to answer any concerns you might have about appraisals in Springfield and Greene County. Contact us today to see how we can help you with your specific valuation problems.

What is an appraisal?
Describe what an appraiser does
What would cause me to require services from Park Place Appraisals, LLC?
How is an appraiser different than a home inspector?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What does the appraisal report contain?
Once the appraisal is done, what guarantee is there that the final number is valid?
What goes into an appraiser's certification?
Who engages the services of appraisers?
Where does Park Place Appraisals, LLC get the information used to estimate values in Greene 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?
Should I do anything in advance of the appraisal appointment
What is "Market Value?"
Does the appraisal belong to the bank or the consumer?
How can I get the most ROI out of home improvements?

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

An appraisal report is a thought process leading to an opinion of value. This opinion or estimate is figured using a formal method that generally uses the three main "common approaches to value". One of the processes in use is the Cost Approach, which is what it would cost to replace the improvements to the property, less the depreciation and physical dilapidation, plus the land value. The Sales Comparison Approach involves finding similar houses nearby and discovering the value based on making a comparison of those homes to the house being appraised. Generally speaking, the Sales Comparison Approach is the most definite indicator of market value of a house. One of the least common approaches in appraising houses is the Income Approach, which is generally used to find the value of a property based on what an investor would pay based on the income produced by the property.

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

An appraiser forumlates an unbiased and well substantiated assessment of market value, in the support of real estate exchanges. Appraisers present their expert analysis in appraisal reports.

What would cause me to require services from Park Place Appraisals, LLC? (Go to list of questions)

There are many reasons to obtain an appraisal from Park Place Appraisals, LLC with the most common reason being real estate and mortgage transactions. Other reasons for getting an appraisal report include:

If you are applying for a loan.
If you would like to reduce your property tax obligations.
To build a case for a homeowner's equity and remove Primary Mortgage Insurance.
To contest improperly assessed property taxes.
If you need to take care of an estate.
To offer you an edge when purchasing real estate.
To find an honest sales price when selling your home.
To defend your rights if your property is being taken by means of eminent domain in a condemnation case.
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.

If you need more information regarding the appraisal process, please 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 full home inspection. An inspection is a third-party evaluation of the available structure and systems of a house, from the roof to the foundation. The standard home inspector's report will contain an evaluation of the integrity of the home's heating system, 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)? (Go to list of questions)

Frankly, it's like comparing opera to country. The CMA uses market trends to conduct most of their business. Appraisals use comparable sales which are verifiable resources. The appraisal report will also include area and construction values. A CMA delivers a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

Who's creating the report is frankly the biggest difference between a CMA and an appraisal. Real estate agents, who may not have a complete understanding of valuation methods or the entire market, write CMA's. The appraisal is produce by a licensed, certified professional who has made a career out of valuing properties. Likewise, the agent has a vested interest in the property's selling price - their commission - whereas the appraiser is bound by a code of ethics to collect only a flat fee for assignments, regardless of their value conclusion.

What does the appraisal report contain? (Go to list of questions)

Each appraisal should indicate a believable estimate of value and must document the following:

Who engaged the appraiser and other intended users.
The intended use of the report.
The purpose of the appraisal.
The type of value reported and a definition of that value.
The effective date of the appraiser's opinions and conclusions.
Pertinent property characteristics, including: location, physical attributes, legal attributes, economic attributes, the real property interest valued, and non-real estate items included in the appraisal, such as personal property, items that are more or less permanently installed and even intangible factors.
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.
The scope of work considered while working up the job.

For a more detailed look at all that goes into an appraisal report click here: Sample Appraisal Report

Once the appraisal is done, what guarantee is there that the final number is valid? (Go to list of questions)

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

That the information analysis contained in the appraisal was proper.

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

That appraisal services were done in a careful and conscientious manner.

That a solid, substantiated appraisal report was communicated.

To become a state licensed appraiser, we must meet extensive education and experience requirements that give us the background to formulate an unbiased opinion. Likewise, appraisers must stick to a stringent industry code of ethics and observe national standards of practice for real estate appraisal. The tenets for carrying out an appraisal and reporting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Go to list of questions) Regulations regarding licensing and certification vary from state to state. In general, licensing and certification is most often associated with many hours of coursework, tests and practical experience. Once an appraiser is licensed, he/she is required to complete 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)

Typically, appraisers are called upon by mortgage lenders to render a value opinion on real estate involved in a loan transaction - to make sure the property is truly adequate collateral for the loan. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

Where does Park Place Appraisals, LLC get the information used to estimate values in Greene County or other areas? (Go to list of questions)

Gathering data is one of the primary activities of an appraiser. 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 documented by the appraiser while on site.

General data is collected from a numerous sources. To research recently sold homes to be used as "comps", we often use the local Multiple Listing Service. To verify actual sales prices, we use items in the assessor's office and other public documents. Appraisers often have to report when a property lies 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 creating appraisals for other properties in the same market.

What can a full appraisal do for me? (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. When selling your home, an appraisal will help you determine the most appropriate price. If you're buying, it makes sure you don't overpay. For people settling an estate or divorce, an appraisal from Park Place Appraisals, LLC is the best way to ensure assets are divided evenly. A house is often the single, largest financial asset anybody owns. Knowing its true value means you can make informed financial decisions.

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

PMI stands for Private Mortgage Insurance. This supplemental policy guards the lender in the event a borrower doesn't pay on the loan and the value of the home is lower than what is owed on the loan. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.


	The savings from dropping your PMI will make up for the cost of the appraisal in no time. Nobody is more qualified than Park Place Appraisals, LLC when it comes to analyzing real estate appreciation in Springfield and Greene County. Contact us today.

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

We start 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 condition of its features. Is there anything you can do to help? Yes there is! First, be 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 get in our way while we measure the structure. Indoors, make sure the appraiser can get to items like furnaces and water heaters.

To help speed things along plus ensure a more accurate report, attempt if possible to have the following items:

Records on the latest purchase of the property in the last three years.
Title policy that describes encroachments or easements.
Any "Homeowners Associations" agreements or, if applicable, condo agreements or fees .
A copy of the current listing agreement and broker's data sheet and Purchase Agreement if a sale is "pending".
A list of "suggested" improvements when the property is being appraised "as complete".

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

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? (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 report - it's usually included 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 scenarios, the appraiser may stipulate 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.

How can I get the most ROI out of home improvements? (Go to list of questions)

This really depends on where the home is. 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 move. 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, something that may not add value would be painting just for the sake of redecorating.