Ben Hill Appraisal has answers to "Frequently Asked Questions"


	Ben Hill Appraisal is always ready to talk to you about any inquiries you might have about appraisals in Katy and Harris County. Feel free to contact us today.

Describe an appraisal
What does an appraiser do?
What are the reasons a person would request your 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?
Once the appraisal has been delivered, what assurance is there that the value conclusion is trustworthy?
How are appraisers certified?
Who do appraisers work for?
Where does an appraiser get the data used to estimate values in Harris County or other areas?
What can a full appraisal do for me?
What exactly is PMI and how can I get rid of it?
Should I do anything in advance of the appraisal inspection
How does an appraiser define "Market Value"?
Who has rights to the appraisal report?
How can I get the most ROI out of home improvements?

Describe an appraisal (List of questions)

An appraiser performs an estimation that produces an opinion of value. This opinion or estimate is arrived at using a formal process that generally utilizes the three main "common approaches to value". One of the methods is the Cost Approach - which is how much it would cost to replace the improvements, less physical deterioration and other factors, then adding the land value. The most common approach in finding the value of a home is the Sales Comparison Approach which deals with concluding a comparison to comparable houses nearby. Generally speaking, the Sales Comparison Approach is the most accurate indicator of market value of a house. 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 produce.

What does an appraiser do? (List of questions)

An appraiser generates an objective and well justified opinion of market value, to be used in making real estate transactions. Appraisers demonstrate their professional findings in appraisal reports.

What are the reasons a person would request your services? (List of questions)

There are a lot of reasons to order an appraisal from Ben Hill Appraisal with the usual reason being real estate and mortgage transactions. A few other reasons for purchasing an report include:

To get a loan.
To lower your property taxes.
To demonstrate a homeowner's acquired equity and remove Primary Mortgage Insurance.
To contest high property taxes.
If you need to take care of an estate.
To give you a leg-up when purchasing a home.
To determine an honest property value when putting your home on the market.
To ensure parties are provided just compensation in eminient domain cases.
Government agencies such as the IRS require an appraisal on every property.
If you are ever involved in a civil case.

For a more extensive description of the appraisal process click here.

How is an appraisal different than a home inspection? (List of questions)

Home inspectors do not estimate an opinion of value and do not use the same forms as appraisers. An inspection is a third-party evaluation of the livable structure and appliances of a home, from the top to the bottom. Commonly, a home inspection report will explain the amenities and the requirements of the home: 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, visible insulation, walls, floors, ceilings, windows, then the foundation, basement and other visible structures.

Is an appraisal the same as a comparative market analysis(CMA)? (List of questions)

Simply put, it's apples and oranges. The CMA relies on vague local market trends. The appraisal is based on specific valid comparable sales. Location and architectural values are also a priority in an appraisal. The CMA will provide a non-specific figure. Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.

The person behind the report is actually the most significant difference between a CMA and an appraisal. Real estate agents, who may not have a true grasp of valuation methods or the entire market, generate CMA's. A certified, Texas licensed professional who has formed their livelihood on valuing homes in and around Harris County creates the appraisal. Further, the appraiser is an unbiased party, with no conditional interest in the property's value, unlike the real estate agent, who gets a commission based upon the value of the home.

What can I expect to see in my appraisal report? (List of questions)

Every appraisal must demonstrate a credible estimate of value and should identify the following:

The client and whose purposes the appraisal is to serve.
How the appraisal is supposed to be used.
The appraisal's purpose.
Precisely what "value" attribute is being reported and what that value means.
The effective date of the appraiser's opinions and conclusions.
Relevant property characteristics, including: location, physical characteristics, legal attributes, economic attributes, the real property interest in question, and non-real estate items included in the valuation, such as personal property, permanent equipment installations and even intangible items.
All 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 when completing the assignment.

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

Once the appraisal has been delivered, what assurance is there that the value conclusion is trustworthy? (List of questions)

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

The appraisal contained an appropriate analysis of the information.

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

That appraisal services were rendered in a careful and cognizant manner.

The final appraisal report was understandable, credible and not easily discredited.

There are rigorous classroom and practical experience requirements that must be satisfied in order to get an appraisal license in Texas. In addition, appraisers must obey a meticulous industry code of ethics and respect national standards of practice for real estate appraisal. The guidelines for carrying out an appraisal and reporting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(List of questions) Regulations regarding licensing and certification are different from state to state. In general, licensing and certification typically translates to many hours of coursework, tests and experience working under a supervisory appraiser. Once an appraiser is licensed, he or she must then take continuing education courses in order to keep the license up to date. To see the specific requirements for any state click here.

Who do appraisers work for? (List of questions)

Mortgage lenders are an appraiser's typical client, requiring their services to ensure real estate involved in a mortgage transaction is enough to cover a loan balance in the case of default. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

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

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

General data is received from a number of places. To look up recent sales to be used as "comps", an appraiser will typically use the local Multiple Listing Service. To verify actual sales prices, we research tax records and other public documents. Flood zone data is available from FEMA data outlets, such as a la mode's InterFlood service.

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

What can a full appraisal do for me? (List of questions)

An appraisal is a valuable tool whenever the value of your home is pertinent to a financial decision. If you're selling your home, an appraisal will help you determine the most appropriate price. When buying, be sure you're not overpaying by getting an independent appraisal. For parties settling an estate or divorce, an appraisal from Ben Hill Appraisal is the best documentation to ensure assets are split up fairly. A home is often the single, largest financial asset anybody owns. Don't make decisions in the dark with a professional appraisal.

What exactly is PMI and how can I get rid of it? (List of questions)

PMI is the common abbreviation for for Private Mortgage Insurance. This supplementary policy covers the lender in the event a borrower doesn't pay on the loan and the value of the property is lower 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.


	Is PMI a part of your monthly mortgage payment?Call Ben Hill Appraisal today at 281-382-4032 or send us an e-mail. A current appraisal could save you thousands.

Should I do anything in advance of the appraisal inspection (List of questions)

We start with an inspection of the home. During this process, we 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. The best thing you can do to help is make sure the appraiser has easy access to the exterior of the house . Trim any shrubs and move any items that would make it difficult to measure the structure. Indoors, make sure we can get to appliances like furnaces and water heaters.

To help expedite our work as well as ensure a more accurate report, try if possible to have the following items:

Records on the latest purchase of the property in the last three years.
List of personal property to be sold with the building.
Most recent real estate tax bill and or legal description of the property.
A list of any major home improvements and upgrades, the amount of their purchase and date of their installation (for example, the addition of Insulation or roof repairs) and permit confirmation (if available).
Find copies of the current listing agreement, broker's data sheet and, in the event of a pending sale.

How does an appraiser define "Market Value"? (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 has rights to the appraisal report? (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 certainly 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 situations, the appraiser may define how the appraisal can be used; for PMI removal, or estate planning or tax challenges, for example. If not stipulated otherwise, the home owner can use the appraisal for any purpose.

How can I get the most ROI out of home improvements? (List of questions)

Like all things real estate, this is dependent on a home's location. For example, putting in an inline humidifier could be nice in arid regions, but completely useless near the coast!

As a rule, the best ROI from renovating a home comes in the kitchen. 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 were second, yielding 85%. On the contrary, an improvement that may not add value would be painting just for the sake of redecorating.