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WOLFSON APPRAISAL SERVICES has answers to "Frequently Asked Questions"

WOLFSON APPRAISAL SERVICES is happy to answer any concerns you might have about appraisals or real estate in Norfolk County. Don't hesitate to contact us today.

What is an appraisal?
Describe what an appraiser does
What would cause me to request services from WOLFSON APPRAISAL SERVICES?
How is an appraisal different than a home inspection?
Is an appraisal the same as a comparative market analysis(CMA)?
What can I expect to see in my appraisal report?
Upon completion of the appraisal, how can I have assurance that the value conclusion is veritable?
What does it mean for an appraiser to be licensed?
Who hires an appraiser?
Where does an appraiser get the information used to estimate values in Norfolk County or other areas?
Why do I need a professional appraisal?
My mortgage statement has an item on it for PMI? Can I get rid of that?
How do I get ready for the appraiser?
How does an appraiser define "Market Value"?
Who actually owns the appraisal report?
Which home renovations add the most to the price?



What is an appraisal?   (Back to top)

The procedure of performing an appraisal report consists of an investigation which forms an opinion of value. There are three "common approaches to value" which assists the appraiser arrive at this opinion or estimate. 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 deterioration, plus the land value. Easily the most common approach in finding the value of a home is the Sales Comparison Approach which deals with figuring a comparison to similar homes close by. Being the most commonly used approach, the Sales Comparison Approach tends to be the most accurate and best indicator of market value for a property. The third approach is the Income Approach, which is the most important method in appraising income producing properties - it involves estimating what an investor would pay based on the capital produced by the property.

Describe what an appraiser does   (Back to top)

An appraiser generates a fair and credible opinion of market value, in the support of real property exchanges. Appraisers exhibit their investigation in appraisal reports.


What would cause me to request services from WOLFSON APPRAISAL SERVICES?   (Back to top)

There are many reasons to get an appraisal from WOLFSON APPRAISAL SERVICES with the usual reason being real estate and mortgage transactions. Some other reasons for obtaining an report include:
  • To obtain a loan.
  • If you would like to lower your property tax obligations.
  • To build a case for a homeowner's equity and remove Primary Mortgage Insurance.
  • To challenge improperly assessed property taxes.
  • If you need to take care of an estate.
  • To give you a negotiating tool when purchasing a home.
  • To determine a likely property value 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.
  • If you ever find yourself in a civil case.
Click here for a more extensive explanation of the process dealing with getting an appraisal.


How is an appraisal different than a home inspection?   (Back to top)

Home inspectors do not provide an opinion of value and do not do appraisal reports. An inspection is a third-party evaluation of the accessible structure and mechanical systems of a property, from the top to the bottom. For the most part, a home inspection report will evaluate the amenities and the requirements of the house: air conditioning (weather permitting), electrical services, 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 other visible structures.

Is an appraisal the same as a comparative market analysis(CMA)?   (Back to top)

Frankly, it's like comparing broadband and dial-up. The CMA depends on indistinct market trends. The appraisal depends on specific definite comparable sales. Area and building values are also a priority 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, 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 makes a living out of valuing properties. Likewise, the agent has something at stake since they get a commission based on the property's selling price whereas the appraiser is bound by a code of ethics to accept a flat fee for assignments, regardless of their outcome.

What can I expect to see in my appraisal report?   (Back to top)

Every report should demonstrate a credible value opinion and must document the following:
  • Who engaged the appraiser and other intended users.
  • The intended use of the report.
  • The appraisal's purpose.
  • Precisely what "value" attribute is being reported and what that value means.
  • The effective date of the value opinion.(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 factors, the real property interest in question, and non-real estate items included in the valuation, such as personal property, items that are more or less permanently installed 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.
  • The scope of work considered when completing the job.
For a more detailed look at the work that goes into an appraisal report click here: Sample Appraisal Report


Upon completion of the appraisal, how can I have assurance that the value conclusion is veritable?   (Back to top)

In the documentation of an appraisal, each appraiser must see to it that each of the items below are covered:
  • That the information analysis utilized in the appraisal was appropriate.

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

  • That appraisal services were provided in a careful and judicious manner.

  • The final appraisal report was easy to explain, legitimate and not easily discredited.
To become a state licensed appraiser, we must satisfy intense education and experience requirements that give us the background to produce an unbiased opinion. Plus, appraisers must stick to a stringent industry code of ethics and respect national standards of practice for real estate appraisal. The rules for carrying out an appraisal and reporting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


   (Back to top) Licensing and certification requires coursework, tests and experience working under a supervisor. Once licensed, he/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 hires an appraiser?   (Back to top)

Mortgage lenders are an appraiser's typical client, requiring their services to ensure a home involved in a mortgage transaction is adequate collateral for a loan. Attorneys and CPAs also hire appraisers for divorce and estate settlements.

Where does an appraiser get the information used to estimate values in Norfolk County or other areas?   (Back to top)

One of the main activities of an appraiser is to assimilate property data. Data can be classified as either Specific or General. Specific data is taken from the home itself; Location, condition, amenities, size and other specifics are documented by the appraiser during an inspection.

General data is received from a variety of sources. Local Multiple Listing Services (MLS) have data on recently sold homes that could be used as comparables. Tax records and other public documents reveal actual sales prices in a market. Appraisers often have to report when a property lies 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 assembles general data from his or her past experience in creating appraisals for other properties in the same market.


Why do I need a professional appraisal?   (Back to top)

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 those settling an estate or divorce, an appraisal from WOLFSON APPRAISAL SERVICES is the best documentation to ensure assets are split up fairly. A home 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?   (Back to top)

PMI is the common abbreviation for for Private Mortgage Insurance. This additional policy protects the lender if a borrower defaults on the loan and the value of the property is lower than the balance of 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.

The amount you keep from cancelling the PMI required when you got your mortgage pays for the appraisal in no time. WOLFSON APPRAISAL SERVICES has years of experience with real estate value trends in NEEDHAM and Norfolk County. Contact us today.

How do I get ready for the appraiser?   (Back to top)

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 we have easy access to the exterior of the house (gates aren't locked, etc). Trim any bushes and relocate any items that would make it difficult to measure the structure. On the inside, make sure we can easily access items like furnaces and water heaters.

You can make the inspection go faster and improve the accuracy of the appraisal report by having the following things on hand:
  • A survey or plot map of the property and building (if available).
  • Written property agreements, such as a maintenance agreement for a shared driveway.
  • Any paperwork, such as a title policy with information on encroachments or easements encroachments or easements.
  • Home inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, septic systems and wells.
  • A list of "proposed" improvements when the property is being appraised "as complete".

How does an appraiser define "Market Value"?   (Back to top)

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?   (Back to top)

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 entitled to a copy of the report - it's usually bundled with all the other closing documents - but is not allowed 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.


Which home renovations add the most to the price?   (Back to top)

The answer to this is different depending upon the location of the home. For example, putting in an inline humidifier could be nice in arid regions, but completely useless near the coast!

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 were second, yielding 85%. Adding bedrooms and baths can also boost the value of your home as long as your home doesn't then become an oddball for your neighborhood in terms of size.