Stover Appraisals has answers to "Frequently Asked Questions"


	Stover Appraisals is always eager to address any inquiries you might have about appraisals or real estate in Central Pennsylvania. Don't hesitate to contact us today.

What is an appraisal?
Describe what an appraiser does
Why would someone require services from Stover Appraisals?
How is an appraiser different than a home inspector?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What's in an appraisal report?
Once the report has been completed, what guarantee is there that the value indicated is legitimate?
How hard is it to become certified?
Who employs appraisers?
Where does an appraiser get the data used to estimate values in Dauphin 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?
Should I do anything in advance of the appraisal appointment
What is "Market Value?"
Who has rights to the appraisal report?
Which home renovations add the most to the price?

What is an appraisal? (List of questions)

An appraisal report is a thought process that concludes with an opinion of value. There are three "common approaches to value" which assists the real estate appraiser conclude this opinion or estimate. One of the three is the Cost Approach - which is what it would cost to replace the improvements, less physical deterioration and other factors, then adding the land value. The most common approach in figuring the likely sales price of a house is the Sales Comparison Approach which concerns figuring a comparison to similar properties nearby. The Sales Comparison Approach is normally the most definitive and best indicator of a liklely sales price for a home. The Income Approach is primarily used for figuring out the market value of income-producing properties based on what an investor would pay based on the amount of capital a property would bring in.

Describe what an appraiser does (List of questions)

An appraiser produces a fair and credible assessment of market value, in the support of real estate transactions. Appraisers demonstrate their findings in appraisal reports.

Why would someone require services from Stover Appraisals? (List of questions)

There are a lot of reasons to order an appraisal with the usual reason being real estate and mortgage transactions. Some other reasons for obtaining an appraisal report include:

If you are applying for a loan.
To reduce your tax burden.
To help a homeowner realize if they owe less than 80% of their home's value and remove Primary Mortgage Insurance.
To contest high property taxes.
If you need to take care of an estate.
To give you a leg-up when purchasing a home.
To determine the most probable property value 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.
It's possible you could have to deal with being in a lawsuit - an appraisal will help.

If you need more information about the appraisal process, please click here.

How is an appraiser different than a home inspector? (List of questions)

The appraiser is not a home inspector nor does he/she do a comprehensive home inspection. The purpose of a home inspection is to evaluate the structure of the property from basement to rooftop. The usual property inspector's report will include an evaluation of the condition of the home'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)? (List of questions)

To be blunt, it's like comparing Shakespeare to reality TV. The CMA relies on vague local market trends. The appraisal is reliant on similar proven comparable sales. The appraisal report will also contain neighborhood and building values. A CMA delivers a "ball park figure." Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.

The person behind the report is actually the biggest 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. The appraisal is created by a licensed, certified professional who has made a career out of valuing properties. Likewise, the agent has a vested interest in 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 value conclusion.

What's in an appraisal report? (List of questions)

Every appraisal should indicate a credible value opinion and will clearly state the following:

The client and other intended users.
The intended use of the report.
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.
Pertinent property characteristics, including: location, physical description, legal attributes, economic attributes, the property rights in question, and non-real estate items included in the appraisal, such as personal property, permanent equipment installations and even intangible items.
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.
The scope of work considered while working up the job.

For a more comprehensive view of 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 legitimate? (List of questions)

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

The appraisal used a suitable analysis of the information.

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

That appraisal services were delivered in a careful and conscientious manner.

That a solid, defensible appraisal report was imparted.

To become a state licensed appraiser, we must fulfill extensive education and experience requirements that give us the background to produce an unbiased opinion. Likewise, appraisers must obey a meticulous industry code of ethics and observe national standards of practice for real estate appraisal. The guidelines for carrying out an appraisal and communicating its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(List of questions)

Licensing and certification is achieved through coursework, tests and real world experience. Once an appraiser is licensed, he or she must then take continuing education courses so the license stays up to date. To see the specific requirements for any state click here.

Who employs appraisers? (List of questions)

Commonly, appraisers are employed by mortgage lenders to estimate the value of a home involved in a loan transaction - to make sure the house is truly adequate collateral for the loan. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

Where does an appraiser get the data used to estimate values in Central Pennsylvania. (List of questions)

Collecting data is one of the main things an appraiser does. Data can be classified as either Specific or General. Specific data is collected from the property itself; Location, condition, amenities, size and other specific data are noted by the appraiser during an inspection.

General data is gathered from a numerous places. Local Multiple Listing Services (MLS) have data on recently sold homes that might be used as comparables. To double-check actual sales prices, we use items in the assessor's office and other public documents. Appraisers routinely need to report when a property lies in a flood zone, and that information is retrieved from a FEMA data outlet such as a la mode's InterFlood service.

And last but not least, the appraiser assembles general data from his or her collective knowledge gained from doing assignments for other houses in the same market.

Why should I hire a licensed appraiser? (List of questions)

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 figure out the price that gets you the most profit but doesn't leave your home on the market too long; an appraisal can help with that. When buying, be sure you're not overpaying by commissioning an independent appraisal. For people settling an estate or divorce, an appraisal from Stover Appraisals is the best documentation to ensure assets are split up fairly. A home is often the single, largest financial asset anybody owns. Without knowing its real value, wise financial decisions are impossible.

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

PMI is short for for Private Mortgage Insurance. This additional policy guards the lender if a borrower is unable to pay on the loan and the value of the home is lower than the loan balance. 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.


	Did you have less than 20% to put down on your mortgage? Contact Stover Appraisals today at 717-579-8165 to see if you can get rid of your Private Mortgage Insurance payment.

Should I do anything in advance of the appraisal appointment (List of questions)

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. Inside, make sure it is clutter free and that we can get to things like furnaces and water heaters. In the yard, trim any bushes so we can be free to get an accurate measurement of exterior walls.

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

A survey or plot map of the property and building (if readily available).
List of personal property to be sold with the home.
Any inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, septic systems 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?" (List of questions)

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 has rights to the appraisal report? (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 included with all the other closing documents - but is not allowed 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 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 do whatever they want with the appraisal.

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

A home's location - what city it is in and even what part of that city - is key to this popular question. For example, if you live in a cold region, insulated windows can be a real plus. But they aren't as attractive in a warm-weather climate.

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 help 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.