Huff, Meyer and Douglas Appraisals, LLC has answers to "Frequently Asked Questions"


	Huff, Meyer and Douglas Appraisals, LLC is always ready to answer any concerns you might have about appraisals or real estate in Kenton County. Contact us today to learn how we can help solve your valuation problems.

What is an appraisal?
What does an appraiser do?
Why would someone request services from Huff, Meyer and Douglas Appraisals, LLC?
How is an appraisal different than a home inspection?
Is an appraisal the same as a comparative market analysis(CMA)?
What does the appraisal report contain?
Once the assignment is done, how can I have certainty that the final number is trustworthy?
What does it mean for an appraiser to be licensed?
Who do appraisers work for?
Where does an appraiser get the information used to estimate values in Kenton County or other areas?
Why do I need a professional appraisal?
What exactly is PMI and how can I get rid of it?
Do you need anything from me in advance?
What is "Market Value?"
Once complete, who actually owns the appraisal report?
Are some home improvements more worthwhile than others?

What is an appraisal? (Back to top)

The method of performing an appraisal consists of an inspection which leads to an opinion of value. This opinion or estimate is discerned through the use of a formal method that commonly uses three "common approaches to value". The Cost Approach is one of the processes that real estate appraisers use to find the value of a home; it involves figuring what the improvements would cost less physical depreciation, adding the land value. Another of the approaches is the Sales Comparison Approach - which deals with making a comparison to other similar nearby properties which have recently sold. The Sales Comparison Approach is commonly the most accurate and best indicator of value for a residential property. The third approach is the Income Approach, which is of most importance in appraising income producing properties - it deals with estimating what an investor would pay based on the income generated by the property.

What does an appraiser do? (Back to top)

An appraiser offers an unprejudiced and well justified determination of market value, to be used in making real estate transactions. Appraisers show their professional investigation in appraisal reports.

Why would someone request services from Huff, Meyer and Douglas Appraisals, LLC? (Back to top)

There are a lot of reasons to purchase an appraisal with the most common reason being real estate and mortgage transactions. A few other reasons for getting an report include:

If you are applying for a loan.
If you would like to reduce your property tax obligations.
To build a case for a homeowner's equity and remove insurance.
To contest improperly assessed property taxes.
If you need to take care of an estate.
To provide you a leg-up when purchasing a home.
To determine a reasonable sales price 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 be involved in a lawsuit - an appraisal will help.

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

How is an appraisal different than a home inspection? (Back to top)

Home inspectors do not come to an opinion of value and do not use the same forms as appraisers. The point of a home inspection is to investigate the structure of the home from basement to top. The archetypal house inspector's report will contain an evaluation of the integrity of the home's heating systems, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and accessible insulation, walls, ceilings, floors, windows and doors, the foundation, basement, and visible structure.

Is an appraisal the same as a comparative market analysis(CMA)? (Back to top)

Honestly, they share nothing in common. The CMA uses market trends to generate most of their business. An appraisal is based on comparable sales that can be verified by public record. Area and construction prices are also precedent in an appraisal. The CMA will provide a non-specific figure. An appraisal delivers a defensible and carefully documented opinion of value.

But the most significant factor is who's doing the report. Real estate agents write CMA's, and they don't always know the whole market or have specific competence when it comes to home valuation. The appraisal is produce by a licensed, certified professional who has made a career out of valuing properties. Likewise, the agent has something at stake since they get a commission based on the property's selling price whereas the appraiser is bound by a code of ethics to accept a previously agreed upon sum for work they perform, regardless of their value conclusion.

What does the appraisal report contain? (Back to top)

The main point of an appraisal report is to let the reader know the value of the real estate in question, and depending on the scope of the report, one will customarily see the following:

Who engaged the appraiser and whose purposes the appraisal is to serve.
How the appraisal is supposed to be used.
The purpose of the assignment.
The type of value contained and a definition of that value.
The effective date of the value opinion.(Sometimes this is in the past or maybe the future for new construction!)
Characteristics of the property that have a bearing on the value, including: location, physical attributes, legal attributes, economic attributes, the property rights in question, and non-real estate items included in the appraisal, such as personal property, items that are more or less permanently installed 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 activity of completing the job.

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

Once the assignment is done, how can I have certainty that the final number is trustworthy? (Back to top)

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

The appraisal contained an apropos analysis of the data.

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

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

That a solid, supportable appraisal report was imparted.

There are intense education and on the job experience requirements that must be met in order to become a licensed appraiser in Kentucky. In addition, appraisers must stick to a meticulous industry code of ethics and comply with national standards of practice for real estate appraisal. The guidelines for working up an appraisal and reporting its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Back to top) Licensing and certification requires classroom study, tests and real world experience. Once licensed, he/she is required to take continuing education courses in order to keep the license current. To see the specific requirements for any state click here.

Who do appraisers work for? (Back to top)

Mortgage lenders are an appraiser's most likely client, needing their services to ensure property involved in a mortgage transaction is adequate collateral for a loan. Attorneys and CPAs also hire appraisers for divorce and estate settlements.

Where does an appraiser get the information used to estimate values in Kenton County or other areas? (Back to top)

One of the primary tasks an appraiser performs is to gather property data. Data can be described as either Specific or General. Specific data is collected 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 number of places. Local Multiple Listing Services (MLS) provide information on recently sold homes that might be used as comparables. To double-check actual sales prices, we research tax records and other public documents that are usually online nowadays. Flood zone data is available from FEMA data outlets, such as a la mode's InterFlood service.

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 do I need a professional appraisal? (Back to top)

An appraisal is a valuable tool whenever your home's value is relevant to a financial decision. If you're selling your house, an appraisal helps you set the most appropriate price. When buying, be sure you're not overpaying by commissioning an independent appraisal. For people settling an estate or divorce, an appraisal from Huff, Meyer and Douglas Appraisals, LLC is the best documentation to ensure assets are divided fairly. Simply put, a house 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? (Back to top)

PMI is the common abbreviation for for Private Mortgage Insurance. This added plan protects the lender if a borrower doesn't pay on the loan and the market price of the property 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.


	The amount you keep from dropping the PMI required when you got your mortgage will make up for the cost of the appraisal in no time. Nobody is more qualified than Huff, Meyer and Douglas Appraisals, LLC when it comes to analyzing real estate appreciation in Ft. Mitchell and Kenton County. Contact us today.

Do you need anything from me in advance? (Back to top)

The first step in most appraisals is the home inspection. During this process, the appraiser 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 shrubs and move any items that would make it difficult to measure the structure. On the inside, make sure the appraiser can get to items like furnaces and water heaters.

The following items, if available, will help your appraiser to provide a more accurate appraisal in a shorter period of time:

Written property agreements, such as a maintenance agreement for a shared driveway.
Any documents, such as a title policy with information on encroachments or easements encroachments or easements.
Any inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, your septic system and wells.
A list of any major home improvements and upgrades, the amount of their purchase and date of their installation (for example, the addition of Energy efficiency upgrades or roof repairs) and permit confirmation (if available).
Most recent real estate tax bill from Kenton and or legal description of the property.

What is "Market Value?" (Back to top)

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."

Once complete, who actually owns the appraisal report? (Back to top)

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 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 hiring the appraiser for things outside securing a mortgage. In these cases, the appraiser may define how the appraisal can be used; for PMI removal, or estate planning or tax challenges, for example. If not stipulated otherwise, the home owner can use the appraisal for any purpose.

Are some home improvements more worthwhile than others? (Back to top)

Like all things real estate, this is dependent on a home's location. 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 weren't far behind, 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.