Jensen Appraisal has answers to "Frequently Asked Questions"


	Jensen Appraisal is eager to talk to you about any questions you might have about appraisals or real estate in Logandale and Clark County. Contact us today to see how we can help solve your specific valuation problems.

Describe an appraisal
Describe what an appraiser does
Why would a person require services from Jensen 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 does the appraisal report contain?
Once the assignment has been completed, how can I have assurance that the value conclusion is valid?
What goes into an appraiser's certification?
Who employs appraisers?
Where does Jensen Appraisal get the data used to estimate values in Clark County or other areas?
Why do I need a professional appraisal?
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 inspection
What is "Market Value?"
Who actually owns the appraisal report?
Which home renovations add the most to the price?

Describe an appraisal (Go to list of questions)

The process of performing an appraisal report deals with an investigation which forms an opinion of value. There are three "common approaches to value" which helps the appraiser arrive at this opinion or estimate. The Cost Approach is one of the approaches that real estate appraisers use to find the value of a house; it involves concluding what the improvements would cost without physical deterioration, adding the land value. The Sales Comparison Approach deals with searching for comparable homes in close proximity and figuring out the value based on comparing those properties to the house in question. The Sales Comparison Approach is commonly the most accurate and best indicator of value for a home. The Income Approach is primarily 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.

Describe what an appraiser does (Go to list of questions)

An appraiser forumlates an unbiased and well supported determination of market value, in the support of real property exchanges. Appraisers show their expert investigation in appraisal reports.

Why would a person require services from Jensen Appraisal? (Go to list of questions)

There are many reasons to order an appraisal with the most common reason being real estate and mortgage transactions. Some 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 contest improperly assessed property taxes.
To deal with an estate.
To give you a negotiating tool when purchasing real estate.
To find a reasonable price when selling real estate.
To ensure parties are provided just compensation in eminient domain cases.
Government agencies such as the IRS require an appraisal on every house.
It's possible you could be involved in a lawsuit - an appraisal will definitely help.

Click here for a more extensive explanation of the process dealing with getting an appraisal.

What is the difference between an appraisal and a home inspection? (Go to list of questions)

The appraiser is not a home inspector nor does he/she do a complete home inspection. A third-party home inspector will inspect the structure of the property, from the top to the bottom. For the most part, a home inspection report will discuss the amenities and the necessities of the property: air conditioning (weather permitting), electrical functions, the condition of the heating system, the plumbing; then the structural capacity of the home such as the attic, exposed insulation, walls, floors, ceilings, windows, then the foundation, basement and visible structures.

What is the difference between an appraisal and a comparative market analysis (CMA)? (Go to list of questions)

Simply, they share nothing in common. What the CMA depends on are superficial trends. An appraisal utilizes comparable sales that can be verified by records. Location and building values are also important in an appraisal. The CMA will provide a non-specific figure. Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.

Who's creating the report is hands down the biggest difference between a CMA and an appraisal. Real estate agents, who may not have a complete understanding of valuation methods or the entire market, write CMA's. A certified, Nevada licensed professional who made a career on valuing homes in and around Clark County is behind the appraisal. Likewise, the agent has a vested interest in the property's selling price whereas the appraiser is bound by a code of ethics to collect only a previously agreed upon fee for assignments, regardless of their value conclusion.

What does the appraisal report contain? (Go to list of questions)

Each appraisal must indicate a believable value opinion and will identify 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 appraisal.
Characteristics of the property that have a bearing on the value, including: location, physical characteristics, legal attributes, economic attributes, the property rights in question, and non-real estate items included in the valuation, such as personal property, permanent equipment installations and even intangible factors.
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 process of completing the job.

For a more in depth look at what goes into an appraisal report click here: Sample Appraisal Report

Once the assignment has been completed, how can I have assurance that the value conclusion is valid? (Go to list of questions)

In the documentation of an appraisal, each appraiser must see to it that each of the items below are covered:

The appraisal contained analysis of the information.

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

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

That a solid, substantiated appraisal report was conferred.

There are intense classroom and experience requirements that must be satisfied in order to achieve the designation of "licensed appraiser" in Nevada. Likewise, appraisers must follow a stringent industry code of ethics and observe national standards of practice for real estate appraisal. The guidelines for developing an appraisal and reporting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Go to list of questions) Licensing and certification is achieved through classroom study, tests and experience working under a supervisory appraiser. Once licensed, he/she is required to take continuing education courses so that the license doesn't expire. To see the specific requirements for any state click here.

Who employs appraisers? (Go to list of questions)

Most of the time, appraisers are employed by mortgage lenders to render a value opinion on a home involved in a loan transaction. Attorneys and CPAs also retain the services of appraisers for divorce and estate settlements.

Where does Jensen Appraisal get the data used to estimate values in Clark County or other areas? (Go to list of questions)

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

General data is gathered from a variety of 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 use items in the assessor's office and other public documents that are usually online nowadays. Appraisers often have 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 service.

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

Why do I need a professional appraisal? (Go to 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. If you're selling your home, an appraisal will help you determine the most appropriate price. 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. A house 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? (Go to list of questions)

PMI stands for Private Mortgage Insurance. It guards the lender in the event a borrower is unable to pay on the loan and the market price of the property is lower than what the borrower still owes 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 money you keep from getting rid of the PMI required when you got your mortgage will make up for the price of the appraisal in no time. Jensen Appraisal stays current with real estate value trends in Logandale and Clark County. Contact us today.

Should I do anything in advance of the appraisal inspection (Go to list of questions)

We start with an inspection of the property. 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. On the home's interior, make sure it is clutter free and that we can access things like furnaces and water heaters. On the outside, trim any bushes so we can be free to get an accurate measurement of outside walls.

You can make the inspection 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).
A list of any personal property that is part of the home and you intend to be sold with the home, such as an oven, or a washer and dryer, if applicable.
Home 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 list of "suggested" improvements if the property is to be appraised "as complete".

What is "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 actually owns the appraisal report? (Go to 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 entitled to a copy of the appraisal - 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 situations, the appraiser may stipulate the purpose of the appraisal; for PMI removal, or estate planning or tax challenges, for example. If not stipulated otherwise, the home owner can do whatever they want with the appraisal.

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

This really depends on where the home is. For example, if you're in a neigborhood of small to medium priced homes, a media room may not be something people in that price range want

No matter where you go, however, renovating a kitchen is almost always a safe investment. 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 are right up there with kitchens, yielding 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 atypical for your neighborhood in terms of size.