Nace Appraisal Service has answers to "Frequently Asked Questions"


	Nace Appraisal Service is always ready to answer any inquiries you might have about appraisals in Hattiesburg and Lamar County. Feel free to contact us today.

Describe an appraisal
What does an appraiser do?
Why would a person require your services?
Is an appraisal the same as a home inspection?
Is an appraisal the same as a comparative market analysis(CMA)?
What's in an appraisal report?
After completing the report, how can I have confidence that the value indicated is veritable?
How difficult is it to become certified?
Who are an appraiser's customers?
Where does Nace Appraisal Service get the information used to estimate values in Lamar County or other areas?
How can a licensed appraiser help me?
What exactly is PMI and how can I get rid of it?
Does the appraiser need anything from me in advance?
How does an appraiser define "Market Value"?
Who has rights to the appraisal report?
How can I get the most ROI out of home improvements?

Describe an appraisal (Go to list of questions)

The process of writing an appraisal consists of an evaluation which leads to an opinion of value. The appraiser will use a several "approaches," typically three, to draw up the estimation of market value. One of the processes in use is the Cost Approach, which is what it would cost to replace the improvements to the property, minus age and physical dilapidation, plus the land value. Easily the most common approach in finding the likely sales price of a house is the Sales Comparison Approach which deals with making a comparison to similar houses close by. The Sales Comparison Approach is normally the most accurate and best indicator of a liklely sales price for a home. 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 income a property would bring in.

What does an appraiser do? (Go to list of questions)

An appraiser provides a professional, unbiased assessment of market value, often in the context of a real estate purchase. Appraisers present their investigation in appraisal reports.

Why would a person require your services? (Go to list of questions)

There are many reasons to obtain an appraisal with the most common reason being real estate and mortgage transactions. Other reasons for getting an appraisal include:

If you are applying for a loan.
If you would like to lower your property tax burden.
To help a homeowner realize if they owe less than 80% of their home's value and remove insurance.
To fight high property taxes.
If you need to settle an estate.
To give you a leg-up when purchasing a home.
To determine the most probable sales price 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 home.
It's possible you could be involved 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? (Go to list of questions)

Home inspectors do not produce an opinion of value and do not do appraisal reports. A third-party home inspector will evaluate the structure of the home, from the top to the foundation. The stereotypical house inspector's report will contain 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.

Is an appraisal the same as a comparative market analysis(CMA)? (Go to list of questions)

Simply, they share nothing in common. The CMA relies on indefinite market trends. Appraisals use similar sales which are valid resources. The appraisal report will also contain area and building prices. A CMA delivers a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

But the largest differentiator is who's behind the report. Real estate agents produce CMA's, and they don't always know the whole market or bear specific competence when it comes to home valuation. A certified, state licensed professional who has formed a career on valuing homes in and around Lamar County creates the appraisal. 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 accept a flat sum for assignments, regardless of their outcome.

What's in an appraisal report? (Go to list of questions)

Every report must reflect a believable estimate of value and will identify the following:

Who engaged the appraiser and other intended users.
The intended use of the appraisal.
The reason for the assignment.
Precisely what "value" attribute is being reported and what that value means.
The effective date of the value opinion.
Characteristics of the property that have a bearing on the value, 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 items.
Any 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.
The scope of work used when completing the appraisal.

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

After completing the report, how can I have confidence that the value indicated is veritable? (Go to list of questions)

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

The appraisal contained a suitable analysis of the information.

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

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

That a believable, supportable appraisal report was imparted.

There are rigorous education and experience requirements that must be adhered to in order to get an appraisal license in Mississippi. In addition, appraisers must follow a meticulous industry code of ethics and comply with national standards of practice for real estate appraisal. The tenets for developing an appraisal and documenting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Go to list of questions) Regulations regarding licensing and certification are different from state to state. In general, licensing and certification typically translates to many hours of classroom study, tests and real world experience. Once licensed, he or she must then take continuing education courses in order to keep the license current. To see the specific requirements for any state click here.

Who are an appraiser's customers? (Go to list of questions)

Mortgage lenders are an appraiser's most likely customer, needing their services to ensure a home involved in a mortgage transaction is enough to cover a loan balance in the case of default. Appraisers also provide opinions for legal settlements, tax matters and investment decisions.

Where does Nace Appraisal Service get the information used to estimate values in Lamar County or other areas? (Go to list of questions)

One of the primary things an appraiser does is to compile property data. Data can be categorized as either Specific or General. Specific data is taken from the home itself; Location, condition, amenities, size and other specifics are gathered by the appraiser during an inspection.

General data is received from a number of places. To find out about recently sold homes to be used as "comps", an appraiser will typically use the local Multiple Listing Service. To double-check actual sales prices, we research items in the assessor's office and other public documents. Flood zone data is gathered from FEMA data outlets, such as a la mode's InterFlood service.

And most importantly, the appraiser gathers 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 anytime your home's value is relevant to some financial decision. When selling your home, an appraisal helps you set the most appropriate price. When buying, you can avoid overpaying by commissioning an independent appraisal. For those settling an estate or divorce, an appraisal from Nace Appraisal Service is the best documentation to ensure assets are split up 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.

What exactly is PMI and how can I get rid of it? (Go to list of questions)

PMI stands for Private Mortgage Insurance. It protects the lender in the event a borrower doesn't 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.


	Has your home value appreciated since you first purchased? Call Nace Appraisal Service today at (601) 297-3910 to see if you can save money by removing your Private Mortgage Insurance premium.

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

We start with an inspection of the home. 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 status of its amenities. Inside, pick up any clutter and make sure we can find our way to things like furnaces and water heaters. In the yard, trim any landscaping so we can be free to get an accurate measurement of outside walls.

You can make our visit go faster and improve the quality of the appraisal report by having the following things on hand:

Any records on the purchase of the property for the last three years.
Title policy that lists encroachments or easements.
Any "Homeowners Associations" agreements or, if applicable, condo agreements or fees .
Find copies of the current listing agreement, broker's data sheet and, if the sale is "pending", the purchase agreement.
Most recent real estate tax bill and or legal description of the property.

How does an appraiser define "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 has rights to the appraisal report? (Go to 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 entitled to use the report for any other purpose without permission from the lender.

This rule doesn't apply when a home owner hires an appraiser directly. In these scenarios, the appraiser may define how the appraisal can be used; 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.

How can I get the most ROI out of home improvements? (Go to list of questions)

It really depends on the market. 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. 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, yielding 85%. Adding bedrooms and baths can also increase the value of your home as long as your home doesn't then become an oddball for your neighborhood in terms of size.