Homefront Appraisals, LLC has answers to "Frequently Asked Questions"


	Homefront Appraisals, LLC is always more than happy to reply to any concerns you might have about appraisals or real estate in Macomb and Macomb County. Contact us today to talk about how we can help you with your valuation problems.

Define the term "Appraisal"
What does an appraiser do?
Why would a person require services from Homefront Appraisals, LLC?
Is an appraisal the same as a home inspection?
My agent performed a CMA for me. Is that the same as an appraisal?
What does the appraisal report contain?
Upon completion of the appraisal, how can I have confidence that the final number is trustworthy?
How difficult is it to become certified?
Who hires Homefront Appraisals, LLC
Where does an appraiser get the information used to estimate values in Macomb 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?
Does the appraiser need anything from me in advance?
Define "Market Value"
Who actually owns the appraisal report?
I want to get more for my house. Where should I spend money renovating?

Define the term "Appraisal" (See list of FAQ's)

The process of creating an appraisal deals with an estimation which forms an opinion of value. The real estate 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 is what it would cost to restore the improvements to the home, minus age and physical dilapidation, adding the land value. Another of the methods is the Sales Comparison Approach - which deals with finding a comparable analysis to other similar properties within a close proximity which have recently sold. Generally speaking, the Sales Comparison Approach is the most definite indicator of market value of a house. The Income Approach is mainly used for finding the market value of income-producing properties based on what an investor would pay based on the amount of capital a property produce.

What does an appraiser do? (See list of FAQ's)

An appraiser generates a professional, unbiased opinion of market value, in the support of real property exchanges. Appraisers demonstrate their expert findings in appraisal reports.

Why would a person require services from Homefront Appraisals, LLC? (See list of FAQ's)

There are a lot of reasons to obtain an appraisal from Homefront Appraisals, LLC with the most common reason being real estate and mortgage transactions. Other reasons for obtaining an report include:

If you are applying for a loan.
To reduce your property taxes.
To build a case for a homeowner's equity and remove PMI.
To contest high property taxes.
To handle an estate.
To provide you a negotiating tool when purchasing real estate.
To find an honest property value when listing your home.
To ensure parties are provided just compensation in eminient domain cases.
Government agencies such as the IRS need an appraisal on every home.
It's possible you could have to deal with being in a lawsuit - an appraisal will definitely help.

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

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

Appraisers do not do perform home inspections and are not home inspectors. The purpose of a home inspection is to evaluate the structure of the property from basement to top. The usual property inspector's report will contain an evaluation of the integrity of the house'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)

To be honest, they share nothing in common. The CMA uses market trends to generate most of their business. Appraisals use comparable sales which are verifiable resources. The appraisal report will also contain location and building costs. All a CMA does is generate a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

The credentials of the person behind the report is actually the biggest difference between a CMA and an appraisal. A CMA is written by a real estate agent who may or may not have a true grasp of the market or valuation concepts. The appraisal is created by a licensed, certified professional who makes a living out of valuing properties. Further, the appraiser is an independent party, with no conditional interest in the value of a home, unlike the real estate agent, whose income is tied to the price of the home.

What does the appraisal report contain? (See list of FAQ's)

The main objective of an appraisal report is to give a value opinion, and depending on the scope of the report, one will customarily see the following:

The client and other intended users.
How the appraisal is supposed to be used.
The appraisal's purpose.
The type of value contained and a definition of that value.
The effective date of the appraisal.
Pertinent property attributes, including: location, physical characteristics, legal attributes, economic attributes, the real property interest valued, and non-real estate items included in the appraisal, such as personal property, permanent equipment installations and even intangible considerations.
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 entailed in the activity of completing the appraisal.

For a more detailed view of what goes into an appraisal report click here: Sample Appraisal Report

Upon completion of the appraisal, how can I have confidence that the final number is trustworthy? (See list of FAQ's)

In communicating an appraisal report, each appraiser must make sure of the following:

That the information analysis utilized in the appraisal was suitable.

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

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

The final appraisal report was transparent, legitimate and not easily discredited.

There are intense education and real world experience requirements that must be satisfied in order to achieve the title of "licensed appraiser" in Michigan. Plus, appraisers must follow a stringent industry code of ethics and respect national standards of practice for real estate appraisal. The rules for carrying out an appraisal and documenting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(See list of FAQ's) Licensing and certification requires coursework, tests and practical experience. Once an appraiser is licensed, he or she must then complete continuing education courses in order to keep the license up to date. To see the specific requirements for any state click here.

Who hires Homefront Appraisals, LLC (See list of FAQ's)

Commonly, appraisers are called upon by lenders to estimate the value of a home involved in a loan transaction. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

Where does an appraiser get the information used to estimate values in Macomb County or other areas? (See list of FAQ's)

One of the main things an appraiser does is to collect property data. Data can be divided into Specific or General. Specific data is gathered from the home itself; Location, condition, amenities, size and other specific data are documented by the appraiser while on site.

General data is received from a many sources. Local Multiple Listing Services (MLS) have data on recently sold homes that could be used as comparables. To double-check actual sales prices, we look at tax records and other public documents that are usually online nowadays. Appraisers often need to report when a property is in a flood zone, and 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 creating appraisals for other properties in the same market.

Why should I hire a licensed appraiser? (See list of FAQ's)

If you're making any kind of financial decision and the value of your home is relevant, you'll want a full appraisal. If you're selling your house, an appraisal assists you in setting the most appropriate price. When buying, be sure you're not overpaying by getting an independent appraisal. For people settling an estate or divorce, an appraisal from Homefront Appraisals, LLC is the best way to ensure assets are split up properly. Simply put, a house is often the single, largest financial asset anybody owns. Knowing its true value means you can make informed financial decisions.

My mortgage statement has an item on it for PMI? Can I get rid of that? (See list of FAQ's)

PMI is short for for Private Mortgage Insurance. This added policy covers the lender in case a borrower is unable to pay on the loan and the market price of the property 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.


	Does your monthly loan payment include a fee for PMI?Call Homefront Appraisals, LLC today at 586-350-4709 or send us an e-mail. Documentation of your home's present value could save you thousands.

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

The first step in most appraisals is the home inspection. 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 the appraiser has easy access to the exterior of the house . Trim any landscaping and relocate any items that would get in our way while we measure the structure. Indoors, make sure the appraiser can get to appliances like furnaces and water heaters.

To help expedite our work plus ensure a more accurate report, attempt if possible to have the following items:

Information on any written private easements, such as a shared driveway with a neighbor.
Any paperwork, 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.
Brag sheet that lists major home improvements and upgrades, the amount of their purchase and date of their installation (for example, the addition of central air conditioning or roof repairs) and permit confirmation (if available).
Most recent real estate tax bill from Macomb and or legal description of the property.

Define "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)

For mortgage transactions, the lender orders the appraisal, either directly or through a third party. 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 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 scenarios, the appraiser may state how the appraisal can be used; 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.

I want to get more for my house. Where should I spend money renovating? (See list of FAQ's)

The added value of a particular amenity truly depends on the local market. For example, adding a central air conditioner in to a home in the South may add significant value, while putting one in a home near the Pacific Northwest might not have much impact.

As a rule, the best ROI 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%. Adding bedrooms and baths can also boost the value of your home (when done well) as long as your home doesn't then become an oddball for your neighborhood in terms of size.