JNJ Appraisal has answers to "Frequently Asked Questions"

JNJ Appraisal is always happy to reply to any inquiries you might have about appraisals or real estate in Columbia County. Contact us today to learn how we can help solve your specific valuation problems.

What is an appraisal?
Describe what an appraiser does
What would cause me to request your services?
How is an appraiser different than a home inspector?
My agent performed a CMA for me. Is that the same as an appraisal?
What can I expect to see in my appraisal report?
Once the report has been delivered, what guarantee is there that the value indicated is veritable?
How hard is it to become certified?
Who employs appraisers?
Where does an appraiser get the data used to estimate values in Columbia County or other areas?
How can a licensed appraiser help me?
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 does "Market Value" mean?
Once complete, who actually owns the appraisal report?
Which home renovations add the most to the price?



What is an appraisal?   (See list of FAQ's)

An appraisal is an estimation allowing the appraiser to come to an opinion of value. There are three "common approaches to value" which helps the real estate appraiser come to this opinion or valuation. One of the methods in use is the Cost Approach, which evaluates what it would cost to replace the improvements to the house, minus age and physical deterioration, adding the land value. Easily the most common approach in figuring the likely sales price of a home is the Sales Comparison Approach which deals with concluding a comparison to similar homes nearby. The Sales Comparison Approach is commonly the most accurate and best indicator of a liklely sales price for a residence. The Income Approach is generally used for determining the market value of income-producing properties based on what an investor would pay based on the amount of income a property produce.

Describe what an appraiser does   (See list of FAQ's)

An appraiser provides a professional, unbiased determination of market value, often in the context of a real estate exchange. Appraisers present their conclusions in appraisal reports.


What would cause me to request your services?   (See list of FAQ's)

There are many reasons to order an appraisal from JNJ 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 reduce your property tax obligations.
  • To help a homeowner realize if they owe less than 80% of their home's value and remove Primary Mortgage Insurance.
  • To fight improperly assessed property taxes.
  • If you need to take care of an estate.
  • To provide you a negotiating tool when purchasing real estate.
  • To determine the most probable sales price when listing your home.
  • To ensure parties are provided just compensation in eminient domain cases.
  • Because an official agency such as the IRS requires it.
  • If you ever find yourself in a civil case.
For a more extensive description of the appraisal process click here.


How is an appraiser different than a home inspector?   (See list of FAQ's)

Appraisers do not do perform residential property inspections and are not home inspectors. The purpose of a home inspection is to investigate the structure of the home from foundation to attic. For the most part, a home inspection report will explain the amenities and the necessities of the house: air conditioning (weather permitting), electrical services, the condition of the heating system, the plumbing; then the structural capacity of the home such as the attic, accessible insulation, walls, floors, ceilings, windows, then the foundation, basement and visible structures.

My agent performed a CMA for me. Is that the same as an appraisal?   (See list of FAQ's)

Honestly, they share nothing in common. The CMA uses market trends to generate most of their business. Appraisals use similar sales which are valid resources. Area and building costs are also a priority 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.

But the most significant factor is who's creating 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 bases their livelihood on valuing real estate in and around Columbia County is behind the appraisal. 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 collect only a previously agreed upon sum for assignments, regardless of their value conclusion.

What can I expect to see in my appraisal report?   (See list of FAQ's)

The main objective 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 other intended users.
  • The intended use of the report.
  • The purpose of the appraisal.
  • The type of value reported and a definition of the value reported.
  • The effective date of the appraisal.(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 description, legal attributes, economic attributes, the property rights valued, and non-real estate items included in the valuation, such as personal property, trade fixtures 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 process of completing the job.
For a more in depth look at all that goes into an appraisal report click here: Sample Appraisal Report


Once the report has been delivered, what guarantee is there that the value indicated is veritable?   (See list of FAQ's)

In communicating an appraisal report, each appraiser must see to it that each of the items below are covered:
  • That the information analysis contained in the appraisal was suitable.

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

  • That appraisal services were done in a careful and judicious manner.

  • That a trustworthy, defensible appraisal report was communicated.
To become a state licensed appraiser, there are education requirements as well as on the jobexperience that must be logged. Likewise, appraisers must follow a stringent industry code of ethics and respect 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).


   (See list of FAQ's) Regulations regarding licensing and certification are different from state to state. However, licensing and certification typically translates to many hours of classroom study, tests and real world experience. Once licensed, he/she is required to take continuing education courses so the license remains current. To see the specific requirements for any state click here.

Who employs appraisers?   (See list of FAQ's)

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

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

One of the main activities of an appraiser is to assimilate property data. Data can be described as either Specific or General. Specific data is from the property itself; Location, condition, amenities, size and other specifics are documented by the appraiser while on site.

General data is received from a many places. To look up recently sold homes to be used as "comps", we often use the local Multiple Listing Service. Tax records and other courthouse documents reveal actual sales prices in a market. Flood zone data is gathered from FEMA data outlets, such as a la mode's InterFlood service.

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


How can a licensed appraiser help me?   (See list of FAQ's)

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 house, an appraisal assists you in setting a price that maximizes profit and reduces time on the market. When buying, you can avoid overpaying by getting an independent appraisal. For those settling an estate or divorce, an appraisal from JNJ Appraisal is the best documentation to ensure assets are split up properly. A home is often the single, largest financial asset anybody owns. Knowing its true value is essential to making smart 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 the common abbreviation for for Private Mortgage Insurance. This supplemental policy takes care of the lender in the event a borrower is unable to pay on the loan and the market price of the home is less than what the borrower still owes on the loan. Once you reach the point where your home's equity plus the amount you've paid is at least 20% of your loan balance, you can have your PMI dropped.

Does your monthly house payment have a lineitem for PMI?Call JNJ Appraisal today at 608-444-6259 or send us an e-mail. A current appraisal could save you thousands.

Should I do anything in advance of the appraisal appointment   (See list of FAQ's)

The first step in most appraisals is the home inspection. 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 condition of its amenities. On the home's interior, make sure it is clutter free and that we can access 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.

The following items, if available, will help your appraiser to provide a more accurate appraisal in a shorter period of time:
  • Information on any written private agreements, such as a shared driveway with a neighbor.
  • 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 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 "proposed" improvements if the property is to be appraised "as complete".

What does "Market Value" mean?   (See list of FAQ's)

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?   (See list of FAQ's)

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 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.

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 noted otherwise, the home owner can use the appraisal for any purpose.


Which home renovations add the most to the price?   (See list of FAQ's)

The answer to this is different depending upon the location of the home. 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 are right up there with kitchens, 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 atypical for your neighborhood in terms of size.