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NY METRO APPRAISAL SERVICES, Inc. has answers to "Frequently Asked Questions"

NY METRO APPRAISAL SERVICES, Inc. is prepared to elaborate on any questions you might have about appraisals in Bronx County. Contact us today to learn how we can help solve your valuation problems.

What is an appraisal?
Describe what an appraiser does
What are the reasons someone would need a real estate appraisal?
Is an appraisal the same as a home inspection?
My agent performed a CMA for me. Is that the same as an appraisal?
What are the contents of an appraisal report?
Once the appraisal has been delivered, how can I have certainty that the value conclusion is accurate?
What goes into an appraiser's certification?
Who employs appraisers?
Where does NY METRO APPRAISAL SERVICES, Inc. get the data used to estimate values in Bronx County or other areas?
Why do I need a professional appraisal?
What exactly is PMI and how can I get rid of it?
Does the appraiser need anything from me in advance?
What is "Market Value?"
Who actually owns the appraisal report?
How can I get the most ROI out of home improvements?



What is an appraisal?   (See list of FAQ's)

An appraisal report is an investigation leading to an opinion of value. This opinion or estimate is arrived at by using a formal method that usually utilizes the three main "common approaches to value". One of them is the Cost Approach - which is what it would cost to replace the improvements, minus physical deterioration and other factors, then adding the land value. The Sales Comparison Approach involves searching for comparable homes nearby and finding value based on making a comparison of those homes to the property in question. Being the most popular approach, the Sales Comparison Approach tends to be the most precise and best indicator of market value for a house. The third approach is the Income Approach, which is the best method in appraising income producing properties - it deals with estimating what an investor would pay based on the capital generated by the property.

Describe what an appraiser does   (See list of FAQ's)

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


What are the reasons someone would need a real estate appraisal?   (See list of FAQ's)

There are many reasons to get an appraisal from NY METRO APPRAISAL SERVICES, Inc. with the most common reason being real estate and mortgage transactions. Other reasons for ordering an appraisal report include:
  • If you are applying for a loan.
  • To reduce your tax burden.
  • To show a homeowner has 30% equity and remove Primary Mortgage Insurance.
  • To fight inflated property taxes.
  • If you need to settle an estate.
  • To give you an edge when purchasing a home.
  • To find a reasonable property value when selling your home.
  • To protect your rights if your property is being taken by means of eminent domain in a condemnation case.
  • Because an official agency such as the IRS requires it.
  • If you are ever involved in a civil case.
If you need more information regarding the appraisal process, please click here.


Is an appraisal the same as a home inspection?   (See list of FAQ's)

Home inspectors do not generate an opinion of value and do not use the same forms as appraisers. A third-party home inspector will evaluate the structure of the property, from the top to the bottom. The archetypal home inspector's report will contain an evaluation of the condition of the property's heating system, 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.

My agent performed a CMA for me. Is that the same as an appraisal?   (See list of FAQ's)

Simply put, it's like comparing broadband and dial-up. What the CMA depends on are vague trends. Appraisals use similar sales which are valid resources. Area and construction values are also important in an appraisal. A CMA delivers a "ball park figure." Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.

But the most significant factor is the person behind the report. A CMA is created by a real estate agent who may or may not have a true grasp of the market or valuation concepts. The appraisal is produce by a licensed, certified professional who makes a living out of valuing properties. Likewise, the agent has something at stake since they get a commission based on the property's selling price - their commission - whereas the appraiser is bound by a code of ethics to collect only a previously agreed upon fee for work they perform, regardless of their outcome.

What are the contents of an appraisal report?   (See list of FAQ's)

The main purpose of an appraisal document is to give a value opinion, and depending on the scope of the report, one will customarily see the following:
  • Who engaged the appraiser and other intended users.
  • The intended use of the report.
  • The reason for the assignment.
  • The type of value reported and a definition of the value reported.
  • The effective date of the value opinion.(Sometimes this is in the past or maybe the future for new construction!)
  • Relevant property attributes, including: location, physical characteristics, legal attributes, economic factors, the property rights valued, and non-real estate items included in the appraisal, such as personal property, trade fixtures 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 appraisal.
For a more detailed view of what goes into an appraisal report click here: Sample Appraisal Report


Once the appraisal has been delivered, how can I have certainty that the value conclusion is accurate?   (See list of FAQ's)

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

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

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

  • The final appraisal report was easy to explain, sound and conclusive.
To become a state licensed appraiser, we must satisfy considerable education and experience requirements that train us to formulate an unbiased opinion. In addition, appraisers must abide by a stringent industry code of ethics and comply with national standards of practice for real estate appraisal. The tenets for working up an appraisal and communicating its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


   (See list of FAQ's) Regulations regarding licensing and certification vary from state to state. However, licensing and certification is most often associated with many hours of coursework, tests and real world experience. Once licensed, he or she is required to engage in continuing education courses in order to keep the license up to date. To see the specific requirements for any state click here.

Who employs appraisers?   (See list of FAQ's)

Commonly, appraisers are called upon by lenders to estimate the value of real estate involved in a loan transaction - to make sure the subject is indeed adequate collateral for the loan. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

Where does NY METRO APPRAISAL SERVICES, Inc. get the data used to estimate values in Bronx County or other areas?   (See list of FAQ's)

Collecting data is one of the primary functions of an appraiser. Data can be split into Specific or General. Specific data is gathered from the home itself; Location, condition, amenities, size and other specific data are noted by the appraiser while on site.

General data is collected from a variety of places. Local Multiple Listing Services (MLS) provide data on recently sold homes that might be used as comparables. Tax records and other public documents verify actual sales prices in a market. Appraisers routinely need to report when a property is in a flood zone, so that information is retrieved from a FEMA data outlet such as a la mode's InterFlood product.

And most importantly, the appraiser assimilates general data from his or her past experience in doing assignments for other houses in the same market.


Why do I need a professional appraisal?   (See list of FAQ's)

Any time the value of your home or other real property is being used to make a significant financial decision, an appraisal helps. If you're selling your house, an appraisal assists you in setting a price that maximizes profit and reduces time on the market. When buying, you can avoid overpaying by commissioning 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. Without knowing its real value, wise financial decisions are impossible.


What exactly is PMI and how can I get rid of it?   (See list of FAQ's)

PMI is the common abbreviation for for Private Mortgage Insurance. It covers the lender in case a borrower doesn't pay on the loan and the market price of the property is less 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.

Does your monthly house payment have a lineitem for PMI?Call NY METRO APPRAISAL SERVICES, Inc. today at 646-584-0900 or send us an e-mail. A new appraisal could save you thousands.

Does the appraiser need anything from me in advance?   (See list of FAQ's)

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. Is there anything you can do to help? Yes there is! First, be sure we have easy access to the exterior of the house (gates aren't locked, etc). Trim any bushes and relocate any items that would make it difficult to measure the structure. On the inside, make sure we can get to appliances like furnaces and water heaters.

You can make the inspection go faster and improve the quality of the appraisal report by having the following things on hand:
  • Information on any written private agreements, such as a shared driveway with a neighbor.
  • Any documents, such as a title policy with information on encroachments or easements encroachments or easements.
  • Home inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, your septic system and your well.
  • A copy of the current listing agreement and broker's data sheet and Purchase Agreement if a sale is "pending".
  • A bill for your most recent real estate taxes which should also contain a legal description of the property.

What is "Market Value?"   (See list of FAQ's)

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 actually owns the appraisal report?   (See list of FAQ's)

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 bundled 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 engaging 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 use the appraisal for any purpose.


How can I get the most ROI out of home improvements?   (See list of FAQ's)

Like all things real estate, this is dependent on a home's location. 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, returning 85%. Adding bedrooms and baths can also help the value of your home (when done well) as long as your home doesn't then become atypical for your neighborhood in terms of size.

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