Rick Fuquay Appraisals has answers to "Frequently Asked Questions"


	Rick Fuquay Appraisals is always willing to reply to any inquiries you might have about appraisals or real estate in Chatham County. Contact Rick Fuquay Appraisals today to learn how we can help you with your valuation problems.

Define the term "Appraisal"
Describe what an appraiser does
What would cause me to request services from Rick Fuquay Appraisals?
Is an appraisal the same as a home inspection?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What can I expect to see in my appraisal report?
Once the assignment is done, what guarantee is there that the final number is veritable?
What goes into an appraiser's certification?
Who do appraisers work for?
Where does an appraiser get the information used to estimate values in Chatham 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?
Should I do anything in advance of the appraisal appointment
Define "Market Value"
Once complete, who actually owns the appraisal report?
How can I get the most ROI out of home improvements?

Define the term "Appraisal" (List of questions)

The appraisal process is an evaluation that produces an opinion of value. This opinion or estimate is found by 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 capital would be required to replace the improvements, less physical deterioration and other factors, plus the land value. Easily the most common approach in figuring the likely sales price of a house is the Sales Comparison Approach which involves figuring a comparison to similar properties close by. Being the most commonly used approach, the Sales Comparison Approach is generally the most accurate and best indicator of market value for a home. One of the least common approaches in appraising homes is the Income Approach, which is generally used to figure the market value of a property based on what an investor would pay based on the income produced by the property.

Describe what an appraiser does (List of questions)

An appraiser provides a fair and credible opinion of market value, in the support of real estate exchanges. Appraisers reveal the details of their investigation in appraisal reports.

What would cause me to request services from Rick Fuquay Appraisals? (List of questions)

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

To obtain a loan.
To lower your property taxes.
To demonstrate a homeowner's acquired equity and remove insurance.
To challenge improperly assessed property taxes.
If you need to settle an estate.
To give you a negotiating tool when purchasing real estate.
To figure out an honest 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.
Government agencies such as the IRS require an appraisal on every home.
It's possible you could have to deal with being in a lawsuit - an appraisal will help.

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

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

The appraiser is not a home inspector and does not do a full home inspection. An inspection is a third-party evaluation of the accessible structure and appliances of a home, from the roof to the bottom. The standard property inspector's report will include an evaluation of the integrity of the property's heating systems, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and accessible insulation, walls, ceilings, floors, windows and doors, the foundation, basement, and visible structure.

What is the difference between an appraisal and a comparative market analysis (CMA)? (List of questions)

Honestly, they share nothing in common. The CMA uses market trends to create most of their business. The appraisal depends on similar definite comparable sales. Location and building values are also important in an appraisal. The CMA will provide a non-specific figure. An appraisal delivers a defensible and carefully documented opinion of value.

But the biggest difference is who's behind the report. Real estate agents write CMA's, and they don't always know the whole market or bear specific competence when it comes to home valuation. The appraisal is produce by a licensed, certified professional who has made a career out of valuing properties. Further, the appraiser is an unbiased voice, with no conditional interest in the property's value, unlike the real estate agent, whose income is tied to the value of the home.

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

Each report should indicate a believable estimate of value and will document the following:

Who engaged the appraiser and other intended users.
The intended use of the report.
The purpose of the assignment.
Precisely what "value" attribute is being reported and what that value means.
The effective date of the value opinion.
Pertinent property characteristics, including: location, physical characteristics, legal attributes, economic attributes, the real property interest in question, and non-real estate items included in the appraisal, such as personal property, items that are more or less permanently installed and even intangible factors.
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.
What was involved in the activity of completing the job.

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

Once the assignment is done, what guarantee is there that the final number is veritable? (List of questions)

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 suitable.

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

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

The final appraisal report was easy to explain, legitimate and not easily discredited.

To become a state licensed appraiser, we must meet considerable education and experience requirements that prepare us to formulate an unbiased opinion. In addition, appraisers must abide by a strict industry code of ethics and observe national standards of practice for real estate appraisal. The tenets for working up an appraisal and documenting its results are guaranteed 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. However, licensing and certification typically translates to many hours of coursework, tests and experience working under a supervisor. Once licensed, he or she is required to take continuing education courses so the license stays current. To see the specific requirements for any state click here.

Who do appraisers work for? (List of questions)

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

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

Gathering information is one of the primary tasks an appraiser engages in. Data can be categorized as either Specific or General. Specific data is from the property itself; Location, condition, amenities, size and other specifics are documented by the appraiser during an inspection.

General data is received from a number of places. To research recently sold homes to be used as "comps", an appraiser will often go to the local Multiple Listing Service. To verify actual sales prices, we look at items in the assessor's office and other public documents that are usually online nowadays. Appraisers often need 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 service.

And last but not least, the appraiser assimilates general data from his or her collective knowledge gained from creating appraisals for other houses in the same market.

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

An appraisal is a worthwhile whenever the value of your home is relevant to a financial decision. For those selling a home, you'll want to figure out the 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. When buying, you can avoid overpaying by getting an independent appraisal. If you're engaged in an estate settlement or divorce, it ensures that property is divided fairly. A home is often the single, largest financial asset anybody owns. Knowing its true value means you can make wise financial decisions.

My mortgage statement has an item on it for PMI? Can I get rid of that? (List of questions)

PMI is the common abbreviation for for Private Mortgage Insurance. It guards the lender in the event a borrower defaults on the loan and the value of the home is lower than what is owed on the loan. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.


	The money you keep from getting rid of your PMI pays for the appraisal in a matter of months. Nobody is more qualified than Rick Fuquay Appraisals when it comes to analyzing real estate appreciation in Siler City and Chatham County. Contact us today.

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

We start with an inspection of the property. 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 amenities. Is there anything you can do to help? Yes there is! First, be sure the appraiser has easy access to the exterior of the house (gates aren't locked, etc). Trim any bushes and relocate any items that would get in our way while we measure the structure. Indoors, make sure we 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:

A survey or plot map of the property and building (if available).
A list of any personal property that is part of the home and you intend to be sold with the home, such as a oven, or a washer and dryer, if applicable.
A bill for your most recent real estate taxes which should also contain a legal description of the property.
Brag sheet that lists major home improvements and upgrades, the date of their installation and their cost (for example, the addition of Energy efficiency upgrades or roof repairs) and permit confirmation (if available).
Information on "Homeowners Associations" or condominium covenants and fees.

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."

Once complete, who actually owns the appraisal report? (List of questions)

In most real estate transactions, the appraisal is ordered by the lender. Even though it's the buyer that eventually pays for the report, the lender is the intended user. The buyer is entitled to a copy of the report - it's usually included 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 cases, the appraiser may stipulate the purpose of the appraisal; for PMI removal, or estate planning or tax challenges, for example. If not stipulated otherwise, the home owner can do whatever they want with the appraisal.

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

The answer to this is different depending upon the location of the home. 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.

As a rule, the best ROI from renovating a home comes in the kitchen. 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 weren't far behind, returning 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.