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Snyder Consulting, Inc. has answers to "Frequently Asked Questions"

Snyder Consulting, Inc. is always ready to handle any concerns you might have about appraisals in Prescott and Yavapai County. Contact Snyder Consulting, Inc. today to talk about how we can help solve your valuation problems.

Define the term "Appraisal"
Describe what an appraiser does
What are the reasons someone would need a real estate appraisal?
What is the difference between an appraisal and a home inspection?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What are the contents of an appraisal report?
After completing the report, how can I have confidence that the value conclusion is legitimate?
What goes into an appraiser's certification?
Who engages the services of appraisers?
Where does Snyder Consulting, Inc. get the information used to estimate values in Yavapai 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 is "Market Value?"
Does the appraisal belong to the bank or the consumer?
I want to get more for my house. Where should I spend money renovating?



Define the term "Appraisal"   (Back to top)

An appraisal report is an estimation that concludes with an opinion of value. This opinion or estimate is arrived at through the use of a formal process that commonly uses the three main "common approaches to 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 without physical depreciation, adding the land value. Easily the most common approach in finding the likely sales price of a house is the Sales Comparison Approach which concerns making a comparison to similar homes nearby. Usually, the Sales Comparison Approach is the most definite indicator of market value of a residential property. The Income Approach is primarily used for determining the market value of income-producing properties based on what an investor would pay based on the amount of income a property would bring in.

Describe what an appraiser does   (Back to top)

An appraiser produces a professional, unbiased determination of market value, to be used in making real estate transactions. Appraisers reveal the details of their expert conclusions in appraisal reports.


What are the reasons someone would need a real estate appraisal?   (Back to top)

There are a lot of reasons to purchase an appraisal from Snyder Consulting, Inc. with the most common reason being real estate and mortgage transactions. Some other reasons for purchasing an report include:
  • To obtain a loan.
  • To reduce your property taxes.
  • To help a homeowner realize if they owe less than 80% of their home's value and remove PMI.
  • To contest high property taxes.
  • To deal with an estate.
  • To give you an edge when purchasing a home.
  • To find a likely price when listing your home.
  • 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 detailed explanation of the process of getting an appraisal.


What is the difference between an appraisal and a home inspection?   (Back to top)

Home inspectors do not produce an opinion of value and are not appraisers. The point of a home inspection is to investigate the structure of the home from basement to rooftop. The general house inspector's report will contain an evaluation of the condition 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)?   (Back to top)

Honestly, they share nothing in common. The CMA utilizes market trends to create most of their business. The appraisal is reliant on similar valid comparable sales. Also, the appraisal checks other factors like condition, area and construction costs. All a CMA does is generate a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

Who's behind the report is frankly the most significant difference between a CMA and an appraisal. A CMA is created by a real estate agent who may or may not be trained in technical valuation concepts or even have a handle on market trends. A certified, Arizona licensed professional who has formed a career on valuing real estate in and around Yavapai County creates the appraisal. Moreover, the appraiser is an unbiased party, with no vested interest in the property's value, unlike the agent, who gets a commission based upon the price of the home.

What are the contents of an appraisal report?   (Back to top)

The main purpose of an appraisal report is to let the reader know the value of the real estate in question, and depending on the scope of the report, you'll usually see 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.(Sometimes this is in the past or maybe the future for new construction!)
  • Pertinent property characteristics, including: location, physical characteristics, legal attributes, economic factors, the property rights 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.
  • Any 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 entailed in the process of completing the assignment.
For a more in depth look at all that goes into an appraisal report click here: Sample Appraisal Report


After completing the report, how can I have confidence that the value conclusion is legitimate?   (Back to top)

In communicating an appraisal report, each appraiser must see to it that each of the items below are covered:
  • The appraisal used an appropriate analysis of the information.

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

  • That appraisal services were not carried out in a careless or negligent fashion.

  • The final appraisal report was understandable, legitimate and conclusive.
To become a state licensed appraiser, we must meet considerable education and experience requirements that give us the background to produce an unbiased opinion. In addition, appraisers must abide by a meticulous industry code of ethics and comply with national standards of practice for real estate appraisal. The tenets for carrying out an appraisal and communicating its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


   (Back to top) Licensing and certification requires classroom study, tests and real world experience. Once an appraiser is licensed, he or she must then engage in continuing education courses in order to keep the license current. To see the specific requirements for any state click here.

Who engages the services of appraisers?   (Back to top)

Mortgage lenders are an appraiser's typical customer, using their services to ensure property 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 Snyder Consulting, Inc. get the information used to estimate values in Yavapai County or other areas?   (Back to top)

One of the most important things an appraiser does is to assimilate data. Data can be divided into Specific or General. Specific data is taken from the home itself; Location, condition, amenities, size and other specific data are noted by the appraiser during an inspection.

General data is received from a many places. Local Multiple Listing Services (MLS) provide data on recently sold homes that could be used as comparables. To verify actual sales prices, we look at items in the assessor's office and other public documents. Appraisers routinely 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 most importantly, the appraiser assimilates 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?   (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. For those selling a home, you'll want to determine 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. 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 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?   (Back to top)

PMI is the common abbreviation for for Private Mortgage Insurance. This added plan protects the lender in the event a borrower is unable to pay on the loan and the value of the house is lower than what is owed 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.

The amount you keep from getting rid of the PMI required when you got your mortgage pays for the appraisal in a matter of months. Nobody is more qualified than Snyder Consulting, Inc. when it comes to analyzing real estate appreciation in Prescott and Yavapai County. Contact us today.

Should I do anything in advance of the appraisal appointment   (Back to top)

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. Inside, pick up any clutter and make sure we can access things like furnaces and water heaters. In the yard, trim any landscaping so we can be free to get an accurate measurement of exterior walls.

You can make things go faster and improve the accuracy of the appraisal report by having the following things on hand:
  • Any records on the purchase of the property for the last three years.
  • A list of any personal property that will be left behind and 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.
  • A list of any major home improvements and enhancements, the date of their installation and their cost (for example, the addition of Energy efficiency upgrades 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.

What is "Market Value?"   (Back to 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."



Does the appraisal belong to the bank or the consumer?   (Back to top)

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 certainly entitled to a copy of the appraisal - 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 scenarios, 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 use the appraisal for any purpose.


I want to get more for my house. Where should I spend money renovating?   (Back to top)

A home's location - what city it is in and even what part of that city - is key to this popular question. For example, installing an inline humidifier could be nice in arid regions, but completely useless near the coast!

As a rule, the most value returned 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, returning 85%. On the contrary, work that may not increase your value would be painting just for the sake of redecorating.