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Emerald Coast Appraisal Services has answers to "Frequently Asked Questions"

Emerald Coast Appraisal Services is happy to reply to any concerns you might have about appraisals or real estate in Escambia County. Contact Emerald Coast Appraisal Services today to talk about how we can help solve your valuation problems.

Describe an appraisal
Describe what an appraiser does
Why would someone request services from Emerald Coast Appraisal Services?
Is an appraisal the same as a home inspection?
My agent performed a CMA for me. Is that the same as an appraisal?
What are the contents of an appraisal report?
Once the report has been delivered, what guarantee is there that the value indicated is legitimate?
What goes into an appraiser's certification?
Who are an appraiser's customers?
Where does an appraiser get the data used to estimate values in Escambia 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?
Does the appraiser need anything from the homeowner in advance?
What does "Market Value" mean?
Does the appraisal belong to the bank or the consumer?
I want to get more for my house. Where should I spend money renovating?



Describe an appraisal   (List of questions)

An appraisal report is an estimation leading to an opinion of value. There are three "common approaches to value" which helps the appraiser come to this opinion or valuation. One of the processes in use is the Cost Approach, which is what it would cost to restore the improvements to the home, minus depreciation and physical dilapidation, adding the land value. Another of the methods is the Sales Comparison Approach - which deals with discovering a comparable analysis to other similar properties within a close proximity which have recently sold. Being the most popular approach, the Sales Comparison Approach is generally the most accurate and best indicator of market value for a house. The Income Approach is mainly used for determining 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   (List of questions)

An appraiser produces a fair and credible determination of market value, often in the context of a real estate sale. Appraisers present their expert findings in appraisal reports.


Why would someone request services from Emerald Coast Appraisal Services?   (List of questions)

There are many reasons to purchase an appraisal with the most common reason being real estate and mortgage transactions. Other reasons for purchasing an appraisal report include:
  • If you are applying for a loan.
  • To reduce your property taxes.
  • To help a homeowner realize if they owe less than 80% of their home's value and remove insurance.
  • To fight improperly assessed property taxes.
  • If you need to take care of an estate.
  • To give you an edge when purchasing a home.
  • To figure out a reasonable 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 ever find yourself in a lawsuit.
If you need a more detailed explanation of the appraisal process, please click here.


Is an appraisal the same as a home inspection?   (List of questions)

Home inspectors do not produce an opinion of value and are not appraisers. A third-party home inspector will judge the structure of the property, from the roof to the foundation. For the most part, a home inspection report will explain the amenities and the requirements of the house: air conditioning (weather permitting), electrical systems, the condition of the heating system, the plumbing; then the structural integrity of the home such as the attic, exposed insulation, walls, floors, ceilings, windows, then the foundation, basement and visible structures.

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

Frankly, it's like comparing broadband and dial-up. What the CMA relies upon are superficial trends. Appraisals use comparable sales which are verifiable resources. The appraisal report will also include location and construction values. The CMA will provide a non-specific figure. An appraisal delivers a defensible and carefully documented opinion of value.

The person creating the report is actually the biggest difference between a CMA and an appraisal. A CMA is created by a real estate agent who may or may not have a true grasp of the market or valuation concepts. The appraisal is produce by a licensed, certified professional who makes a living out of valuing properties. Likewise, the agent has a vested interest in the property's selling price whereas the appraiser is bound by a code of ethics to accept a flat sum for work they perform, regardless of their outcome.

What are the contents of an appraisal report?   (List of questions)

The main purpose of an appraisal document is to provide a value opinion, and depending on the scope of the report, you'll usually see the following:
  • Who engaged the appraiser and whose purposes the appraisal is to serve.
  • How the appraisal is supposed to be used.
  • The reason for the assignment.
  • The type of value reported and a definition of that value.
  • The effective date of the appraisal.
  • Characteristics of the property that have a bearing on the value, including: location, physical characteristics, legal attributes, economic attributes, the real property interest valued, and non-real estate items included in the valuation, such as personal property, trade fixtures 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.
  • The scope of work considered while working up the appraisal.
For a more comprehensive look at all that goes into an appraisal report click here: Sample Appraisal Report


Once the report has been delivered, what guarantee is there that the value indicated is legitimate?   (List of questions)

In communicating an appraisal report, each appraiser must ensure the following:
  • That the information analysis implemented in the appraisal was proper.

  • Whether individually or collectively, there were no crucial errors contained in the report, nor any material details left out.

  • That appraisal services were rendered in a careful and judicious fashion.

  • That a believable, substantiated appraisal report was imparted.
To become a state licensed appraiser, we must fulfill considerable education and experience requirements that prepare us to produce an unbiased opinion. Plus, appraisers must follow a strict industry code of ethics and respect national standards of practice for real estate appraisal. The rules for working up an appraisal and communicating its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


   (List of questions) Regulations regarding licensing and certification of Real Estate Appraisers are different from state to state. In general, licensing and certification is commonly associated with many hours of classroom study, 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 are an appraiser's customers?   (List of questions)

Most of the time, appraisers are hired by lenders to render a value opinion on real estate involved in a loan transaction - to make sure the real estate is truly adequate collateral for the loan. Attorneys and CPAs also retain the services of appraisers for divorce and estate settlements.

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

Collecting information is one of the primary tasks an appraiser does. Data can be described as either Specific or General. Specific data is from the home itself; Location, condition, amenities, size and other specifics are gathered by the appraiser while on site.

General data is collected from a variety of 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 use tax records 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 service.

And last but not least, the appraiser gathers general data from his or her past experience in creating appraisals for other properties in the same market.


Why should I hire a licensed appraiser?   (List of questions)

If you're involved in any kind of financial decision and the value of your home is relevant, you'll want to hire a licensed appraiser. 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 parties settling an estate or divorce, an appraisal from Emerald Coast Appraisal Services is the best way to ensure assets are divided fairly. A house 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?   (List of questions)

PMI is an acronym for Private Mortgage Insurance. It covers the lender in case a borrower defaults on the loan and the value of the property is lower than the balance of the loan. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.

Did you secure your mortgage with less than 20% down? Call Emerald Coast Appraisal Services today at (850) 455-3333 to see if you can save money by removing your Private Mortgage Insurance payment.

Does the appraiser need anything from the homeowner in advance?   (List of questions)

We start with an inspection of the home. 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 access 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 things go faster and improve the quality of the appraisal report by having the following things on hand:
  • A survey or plot map of the property and building (if available).
  • List of personal property to be sold with the home.
  • Any "Homeowners Associations" agreements or, if applicable, condo agreements or fees .
  • Find copies of the current listing agreement, broker's data sheet and, in the event of a pending sale.
  • Most recent real estate tax bill from Escambia and or legal description of the property.

What does "Market Value" mean?   (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."



Does the appraisal belong to the bank or the consumer?   (List of questions)

For mortgage transactions, the lender requests the appraisal, either directly or through a third party. 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 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 situations, the appraiser may stipulate the purpose of the appraisal; for PMI removal, or estate planning or tax challenges, for example. If not noted 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?   (List of questions)

Like all things real estate, this is dependent on a home's location. For example, if you live in a cold region, insulated windows can be a real plus. But they aren't as attractive in a warm-weather climate.

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%. On the contrary, work that may not increase your value would be painting just for the sake of redecorating.