Copeland Appraisals, L.L.C. has answers to "Frequently Asked Questions"


	Copeland Appraisals, L.L.C. is always more than happy to elaborate on any inquiries you might have about appraisals or real estate in Helena and Shelby County. Feel free to contact us today.

Describe an appraisal
What does an appraiser do?
What are the reasons someone would request services from Copeland Appraisals, L.L.C.?
What is the difference between an appraisal and a home inspection?
Is an appraisal the same as a comparative market analysis(CMA)?
What are the contents of an appraisal report?
After completing the report, how can I have assurance that the value conclusion is veritable?
How hard is it to become certified?
Who hires an appraiser?
Where does an appraiser get the data used to estimate values in Shelby 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 does "Market Value" mean?
Who has rights to the appraisal report?
Which home renovations add the most to the price?

Describe an appraisal (Top)

The appraisal process is an estimation that produces an opinion of value. The appraiser will typically use a few "approaches," typically three, to draw up the estimation of market value. The Cost Approach is one of the processes that real estate appraisers use to find value; it involves discerning what the improvements would cost minus physical depreciation, plus the land value. The Sales Comparison Approach involves searching for comparable homes nearby and figuring out the value based on comparing those homes to the house in question. Being the most commonly used approach, the Sales Comparison Approach is generally the most accurate and best indicator of market value for a residential property. 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 would bring in.

What does an appraiser do? (Top)

An appraiser offers a professional, unbiased opinion of market value, in the support of real estate exchanges. Appraisers summarize their expert conclusions in appraisal reports.

What are the reasons someone would request services from Copeland Appraisals, L.L.C.? (Top)

There are many reasons to obtain an appraisal with the most common reason being real estate and mortgage transactions. A few other reasons for ordering an appraisal report include:

If you are applying for a loan.
To reduce your tax burden.
To build a case for a homeowner's equity and remove Primary Mortgage Insurance.
To fight high property taxes.
If you need to take care of an estate.
To provide you a negotiating tool when purchasing a home.
To figure out the most probable price when putting your home on the market.
To defend your rights if your property is being taken by means of eminent domain in a condemnation case.
Because a government agency such as the IRS requires it.
If you ever find yourself in a lawsuit.

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

What is the difference between an appraisal and a home inspection? (Top)

Appraisers do not do complete home inspections and are not home inspectors. An inspection is a third-party evaluation of the available structure and mechanical systems of a house, from the top to the bottom. For the most part, a home inspection report will explain the amenities and the necessities of the property: air conditioning (weather permitting), electrical functions, the condition of the heating system, the plumbing; then the structural capacity of the home such as the attic, exposed insulation, walls, floors, ceilings, windows, then the foundation, basement and visible structures.

Is an appraisal the same as a comparative market analysis(CMA)? (Top)

Honestly, they have nothing in common. What the CMA relies upon are ill-defined trends. The appraisal depends on specific verifiable comparable sales. Area and construction costs are also precedent in an appraisal. A CMA delivers a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

But the most significant factor is the person creating the report. Real estate agents, who may not have a true grasp of valuation methods or the entire market, create CMA's. The appraisal is produce by a licensed, certified professional who has made a career out of valuing properties. Further, the appraiser is an independent voice, with no conditional interest in the value of a home, unlike the real estate agent, whose income is tied to the value of the home.

What are the contents of an appraisal report? (Top)

Every report should reflect a credible estimate of value and will identify the following:

The client and whose purposes the appraisal is to serve.
The intended use of the appraisal.
The appraisal's purpose.
Precisely what "value" attribute is being reported and what that value means.
The effective date of the value opinion.
Relevant property characteristics, including: location, physical description, legal attributes, economic attributes, the property rights in question, and non-real estate items included in the appraisal, such as personal property, permanent equipment installations and even intangible factors.
Any 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 assignment.

For a more detailed 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 veritable? (Top)

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

That the information analysis contained in the appraisal was suitable.

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

That appraisal services were not conducted in a careless or negligent manner.

That a credible, supportable appraisal report was imparted.

To become a state licensed appraiser, we must fulfill extensive education and experience requirements that enable us to formulate an unbiased opinion. Plus, appraisers must abide by a meticulous industry code of ethics and comply with national standards of practice for real estate appraisal. The guidelines for carrying out an appraisal and documenting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Top) Licensing and certification is achieved through coursework, tests and practical experience. Once licensed, he/she must then take continuing education courses so the license remains up to date. To see the specific requirements for any state click here.

Who hires an appraiser? (Top)

Mortgage lenders are an appraiser's most likely client, requesting their services to ensure property involved in a mortgage transaction is adequate collateral for a loan. Attorneys and CPAs also retain the services of appraisers for asset division and estate settlements.

Where does an appraiser get the data used to estimate values in Shelby County or other areas? (Top)

One of the primary tasks an appraiser engages in 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 while on site.

General data is received from a numerous sources. To find out about recent sales to be used as "comps", we often use the local Multiple Listing Service. To verify actual sales prices, we use tax records and other public documents. Flood zone data is gathered from FEMA data outlets, such as a la mode's InterFlood servers.

And last but not least, the appraiser assembles general data from his or her past experience in doing assignments for other properties in the same market.

What can a full appraisal do for me? (Top)

An appraisal is a worthwhile anytime the value of your home is relevant to some financial decision. 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. If you're engaged in an estate settlement or divorce, it ensures that property is divided fairly. 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? (Top)

PMI is short for for Private Mortgage Insurance. PMI protects the lender in case a borrower doesn't pay on the loan and the value of the house is lower than what the borrower still owes on the loan. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.


	Is PMI a lineitem in your monthly mortgage payment?Call Copeland Appraisals, L.L.C. today at 205-329-9345 or send us an e-mail. Documentation of your home's present value could save you thousands.

Should I do anything in advance of the appraisal appointment (Top)

We begin with an inspection of the property. 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. 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 relocate any items that would get in our way while we measure the structure. On the inside, make sure the appraiser can easily access items like furnaces and water heaters.

The following items, if available, will help your appraiser to provide a more accurate appraisal in a shorter period of time:

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.
Information on "Homeowners Associations" or condominium covenants and 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 if the property is to be appraised "as complete".

What does "Market Value" mean? (Top)

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? (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 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 cases, the appraiser may state the purpose of the appraisal; for PMI removal, or estate planning or tax challenges, for example. If not stated otherwise, the home owner can do whatever they want with the appraisal.

Which home renovations add the most to the price? (Top)

The added value of a particular amenity truly depends on the local market. For example, if you're in a neigborhood of small to medium priced homes, a media room may not be something people in that price range want

No matter where you go, however, renovating a kitchen is almost always a safe move. 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, returning 85%. On the contrary, work that may not add value would be painting just for the sake of redecorating.