Realty Valuation Group has answers to "Frequently Asked Questions"

Realty Valuation Group is always prepared to elaborate on any questions you might have about appraisals in Charlotte and Mecklenburg County. Feel free to contact us today.

What is an appraisal?
Describe what an appraiser does
What are the reasons a person would need services from Realty Valuation Group?
Is an appraisal the same as a home inspection?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What does the appraisal report contain?
Once the report has been completed, what guarantee is there that the value indicated is veritable?
What are the requirements to be a certified appraiser?
Who engages the services of appraisers?
Where does an appraiser get the information used to estimate values in Mecklenburg County or other areas?
How can a licensed appraiser help me?
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 is "Market Value?"
Who actually owns the appraisal report?
Which home renovations add the most to the price?



What is an appraisal?   (Go to list of  questions)

An appraisal report is a thought process that concludes with an opinion of value. The appraiser will use a few "approaches," typically three, to come to the estimation of market value. One of the methods in use is the Cost Approach, which evaluates what it would cost to restore the improvements to the property, minus age and physical dilapidation, adding the land value. Easily the most common approach in finding the value of a house is the Sales Comparison Approach which involves concluding a comparison to comparable houses close by. Usually, the Sales Comparison Approach is the most accurate indicator of market value of a home. One of the least common approaches in appraising homes is the Income Approach, which is generally used to find the market value of a property based on what an investor would pay based on the capital produced by the property.

Describe what an appraiser does   (Go to list of  questions)

An appraiser forumlates an objective and well substantiated assessment of market value, to be used in making real estate transactions. Appraisers present their conclusions in appraisal reports.


What are the reasons a person would need services from Realty Valuation Group?   (Go to list of  questions)

There are many reasons to get an appraisal from Realty Valuation Group with the usual reason being real estate and mortgage transactions. Other reasons for getting an appraisal report include:
  • To obtain a loan.
  • If you would like to reduce your property tax burden.
  • To demonstrate a homeowner's acquired equity and remove PMI.
  • To challenge improperly assessed property taxes.
  • If you need to take care of an estate.
  • To give you an edge when purchasing a home.
  • To determine a reasonable property value when selling real estate.
  • 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 need an appraisal on every house.
  • If you ever find yourself in a civil case.
If you need more information about the appraisal process, please click here.


Is an appraisal the same as a home inspection?   (Go to list of  questions)

Home inspectors do not come to an opinion of value and are not appraisers. An inspection is a third-party evaluation of the available structure and appliances of a property, from the top to the foundation. The usual home inspector's report will include an evaluation of the condition of the house's heating systems, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and visible 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)?   (Go to list of  questions)

Frankly, they share nothing in common. What the CMA depends on are ill-defined trends. The appraisal is reliant on specific verifiable comparable sales. The appraisal report will also contain neighborhood and building costs. The CMA will provide a non-specific figure. Being a documented and carefully investigated opinion of value, appraisals are defensible and stand up in legal situations.

The credentials of the person behind the report is hands down the most significant difference between a CMA and an appraisal. Real estate agents, who may not have a complete understanding of valuation methods or the entire market, write CMA's. A certified, state licensed professional who has formed a career on valuing homes in and around Mecklenburg County creates the appraisal. Moreover, the appraiser is an unbiased voice, with no vested interest in the value of a home, unlike the agent, who gets a commission based upon the price of the home.

What does the appraisal report contain?   (Go to list of  questions)

Each report must demonstrate a supported value opinion and should document the following:
  • Who engaged the appraiser and other intended users.
  • How the appraisal is supposed to be used.
  • The purpose of the appraisal.
  • 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 factors, the real property interest valued, 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 other items of a similar nature.
  • Division of interest, such as fractional interest, physical segment and partial holding.
  • What was involved in the activity of completing 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 completed, what guarantee is there that the value indicated is veritable?   (Go to list of  questions)

In communicating an appraisal report, each appraiser must see to it that each of the items below are covered:
  • That the information analysis implemented in the appraisal was proper.

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

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

  • That a trustworthy, defensible appraisal report was conferred.
To become a state licensed appraiser, there are intense education requirements as well as experience that must be attained. In addition, appraisers must follow a strict industry code of ethics and comply with national standards of practice for real estate appraisal. The rules for working up an appraisal and documenting its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


    (Go to list of  questions) Regulations regarding licensing and certification of Real Estate Appraisers vary from state to state. However, licensing and certification typically translates to many hours of coursework, tests and practical experience. Once an appraiser is licensed, he/she is required to engage in continuing education courses so that the license doesn't expire. To see the specific requirements for any state click here.

Who engages the services of appraisers?   (Go to list of  questions)

Most of the time, appraisers are called upon by lenders to estimate the value of a home involved in a loan transaction. Attorneys and CPAs also hire appraisers for divorce and estate settlements.

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

One of the most important things an appraiser does is to collect property data. Data can be described as either Specific or General. Specific data is collected from the home itself; Location, condition, amenities, size and other specific data are noted by the appraiser during an inspection.

General data is collected from a many places. Local Multiple Listing Services (MLS) have information on recently sold homes that could be used as comparables. Tax records and other courthouse documents verify actual sales prices in a market. Flood zone data is retrieved from FEMA data outlets, such as a la mode's InterFlood product.

And most importantly, the appraiser assimilates general data from his or her collective knowledge gained from creating appraisals for other houses in the same market.

How can a licensed appraiser help me?   (Go to list of  questions)

An appraisal is a valuable tool whenever your home's value is relevant to a financial decision. When selling your home, an appraisal assists you in setting a price that maximizes profit and reduces time on the market. When buying, be sure you're not overpaying by commissioning an independent appraisal. If you're engaged in an estate settlement or divorce, it ensures that property is divided fairly. Simply put, a house is often the single, largest financial asset anybody owns. Knowing its true value means you can make the right financial decisions.

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

PMI is the common abbreviation for for Private Mortgage Insurance. PMI protects the lender in case 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 reach the point where your home's equity plus the amount you've paid is at least 20% of your loan balance, you can have your PMI dropped.

Does your monthly mortgage payment include a fee for PMI?Call Realty Valuation Group today at 704-364-4800 or send us an e-mail. A new appraisal could save you thousands.

Does the appraiser need anything from the homeowner in advance?   (Go to list of  questions)

The first step in most appraisals is the property inspection. 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. The best thing you can do to help is make sure we have easy access to the exterior of the house . Trim any bushes and move any items that would get in our way while we measure the structure. On the inside, make sure the appraiser can easily access appliances 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).
  • Information on any written private agreements, such as a shared driveway with a neighbor.
  • Most recent real estate tax bill and or legal description of the property.
  • A list of any major home improvements and enhancements, the amount of their purchase and date of their installation (for example, the addition of Insulation or roof repairs) and permit confirmation (if available).
  • Locate copies of the current listing agreement, broker's data sheet and, if the sale is "pending", the purchase agreement.

What is "Market Value?"   (Go to list of  questions)

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 actually owns the appraisal report?   (Go to list of  questions)

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 certainly 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.

The exception to this rule is when a home owner engages an appraiser directly. 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 noted otherwise, the home owner can do whatever they want with the appraisal.

Which home renovations add the most to the price?   (Go to list of  questions)

This really depends on where the home is. For example, while quality appliances are attractive, a $7000 built-in refrigerator won't pay off in a neighborhood of moderately priced homes

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