M.C. Appraisals, Inc. (410) 827-0771 has answers to "Frequently Asked Questions"


	M.C. Appraisals, Inc. (410) 827-0771 is always prepared to talk to you about any concerns you might have about appraisals or real estate in Huntingtown and Anne Arundel County. Contact M.C. Appraisals, Inc. (410) 827-0771 today to talk about how we can help you with your valuation problems.

Define the term "Appraisal"
Describe what an appraiser does
What are the reasons someone would need a real estate appraisal?
What is the difference between an appraisal and a home inspection?
Is an appraisal the same as a comparative market analysis(CMA)?
What does the appraisal report contain?
After completing the report, how can I have assurance that the value conclusion is trustworthy?
How hard is it to become certified?
Who do appraisers work for?
Where does M.C. Appraisals, Inc. (410) 827-0771 get the information used to estimate values in Anne Arundel County or other areas?
How can a licensed appraiser help me?
My mortgage statement has an item on it for PMI? Can I get rid of that?
Does the appraiser need anything from me in advance?
Define "Market Value"
Who has rights to the appraisal report?
I want to get more for my house. Where should I spend money renovating?

Define the term "Appraisal" (See list of FAQ's)

An appraiser provides an evaluation that generates an opinion of value. This opinion or estimate is concluded through the use of a formal process that commonly utilizes the three main "common approaches to value". One of the processes in use is the Cost Approach, which finds what it would cost to restore the improvements to the home, minus depreciation and physical dilapidation, plus the land value. The Sales Comparison Approach deals with finding similar houses in close proximity and figuring out the value based on making a comparison of those prior sales to the property in question. Being the most commonly used approach, the Sales Comparison Approach is considered the most precise and best indicator of market value for a residential property. The Income Approach is primarily used for finding the market value of income-producing properties based on what an investor would pay based on the amount of income a property would bring in.

Describe what an appraiser does (See list of FAQ's)

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

What are the reasons someone would need a real estate appraisal? (See list of FAQ's)

There are many reasons to get an appraisal from M.C. Appraisals, Inc. (410) 827-0771 with the most common reason being real estate and mortgage transactions. A few other reasons for obtaining an report include:

If you are applying for a loan.
If you would like to reduce your property tax burden.
To demonstrate a homeowner's acquired equity and remove Primary Mortgage Insurance.
To fight inflated property taxes.
To handle an estate.
To provide you an edge when purchasing a home.
To figure out an honest price when putting your home on the market.
To protect 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.
If you are ever involved in a lawsuit.

If you need more information about the appraisal process, please click here.

What is the difference between an appraisal and a home inspection? (See list of FAQ's)

Appraisers do not do perform home inspections and are not home inspectors. A third-party home inspector will evaluate the structure of the property, from the top to the bottom. The general property inspector's report will contain an evaluation of the condition 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.

Is an appraisal the same as a comparative market analysis(CMA)? (See list of FAQ's)

Honestly, they share nothing in common. The CMA relies on indistinct local market trends. Appraisals use similar sales which are verifiable resources. Location and construction 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 largest differentiator is the person behind 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, state licensed professional who has formed a career on valuing real estate in and around Anne Arundel County is behind the appraisal. 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 accept a previously agreed upon fee for assignments, regardless of their value conclusion.

What does the appraisal report contain? (See list of FAQ's)

The main objective of an appraisal report is to let the reader know the value of the real estate in question, and depending on the scope of the report, one will customarily 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 that value.
The effective date of the appraiser's opinions and conclusions.(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 description, 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 considerations.
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 activity of completing the appraisal.

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

After completing the report, how can I have assurance that the value conclusion is trustworthy? (See list of FAQ's)

In communicating an appraisal report, each appraiser must ensure the following:

The appraisal used analysis of the data.

Whether individually or collectively, there were no significant errors contained in the appraisal, nor any material details left out.

That appraisal services were provided in a careful and judicious fashion.

The final appraisal report was understandable, sound and conclusive.

To become a state licensed appraiser, there are education requirements as well as on the jobexperience that must be logged - all with the end goal of being able to render unbiased value opinions. In addition, appraisers must stick to a strict industry code of ethics and comply with national standards of practice for real estate appraisal. The tenets for working up an appraisal and reporting its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(See list of FAQ's) Licensing and certification is achieved through classroom study, tests and real world experience. Once licensed, he or she must then complete continuing education courses so that the license doesn't expire. To see the specific requirements for any state click here.

Who do appraisers work for? (See list of FAQ's)

Mortgage lenders are an appraiser's typical client, using their services to ensure a home involved in a mortgage transaction is adequate collateral for a loan. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

Where does M.C. Appraisals, Inc. (410) 827-0771 get the information used to estimate values in Anne Arundel County or other areas? (See list of FAQ's)

Compiling information is one of the primary occupations of an appraiser. Data can be classified as either Specific or General. Specific data is taken from the property itself; Location, condition, amenities, size and other specifics are gathered by the appraiser while on site.

General data is received from a numerous places. To find out about recent sales to be used as "comps", an appraiser will often use the local Multiple Listing Service. To verify actual sales prices, we use tax records and other public documents that are usually online nowadays. Appraisers often have to report when a property is in a flood zone, so that information is retrieved from a FEMA data outlet such as a la mode's InterFlood product.

And most importantly, the appraiser assimilates general data from his or her past experience in creating appraisals for other houses in the same market.

How can a licensed appraiser help me? (See list of FAQ's)

If you're making any kind of financial decision and the value of your home matters, you'll want to hire a licensed appraiser. When selling your house, an appraisal assists you in setting 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 M.C. Appraisals, Inc. (410) 827-0771 is the best way to ensure assets are divided evenly. 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? (See list of FAQ's)

PMI is short for for Private Mortgage Insurance. PMI covers the lender if 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 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.


	Has your home value appreciated since you first purchased? Contact M.C. Appraisals, Inc. (410) 827-0771 today at 410-827-0771 to see if you can save money by removing your Private Mortgage Insurance premium.

Does the appraiser need anything from me in advance? (See list of FAQ's)

The first step in most appraisals is the home inspection. During this process, the appraiser 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. Inside, pick up any clutter and make sure we can find our way to things like furnaces and water heaters. On the outside, trim any landscaping so we can be free to get an accurate measurement of outside walls.

You can make our visit go faster and improve the accuracy of the appraisal report by having the following things on hand:

Any information on the purchase of the property for the last three years.
Any documents, such as a title policy with information on encroachments or easements encroachments or easements.
Any "Homeowners Associations" agreements or, if applicable, condo covenants or fees .
Find copies of the current listing agreement, broker's data sheet and, if the sale is "pending", the purchase agreement.
A list of "proposed" improvements when the property is being appraised "as complete".

Define "Market Value" (See list of FAQ's)

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? (See list of FAQ's)

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 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 scenarios, the appraiser may state the purpose of the appraisal; 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.

I want to get more for my house. Where should I spend money renovating? (See list of FAQ's)

The added value of a particular amenity truly depends on the local 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.

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 are right up there with kitchens, yielding 85%. On the contrary, something that may not add value would be painting just for the sake of redecorating.