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Mid Florida Appraisers, Inc. has answers to "Frequently Asked Questions"

Mid Florida Appraisers, Inc. is always happy to handle any inquiries you might have about appraisals or real estate in Lakeland and Polk County. Feel free to contact us today.

What is an appraisal?
Describe what an appraiser does
What are the reasons someone would require services from Mid Florida Appraisers, Inc.?
Is an appraisal the same as a home inspection?
My agent performed a CMA for me. Is that the same as an appraisal?
What does the appraisal report contain?
Upon completion of the report, how can I have assurance that the final number is valid?
What are the requirements to be a certified appraiser?
Who do appraisers work for?
Where does Mid Florida Appraisers, Inc. get the information used to estimate values in Polk County or other areas?
Why should I hire a licensed appraiser?
What exactly is PMI and how can I get rid of it?
Does the appraiser need anything from me in advance?
Define "Market Value"
Who has rights to the appraisal report?
How can I get the most ROI out of home improvements?



What is an appraisal?   (Return to top)

An appraisal is an investigation allowing the appraiser to come to an opinion of value. There are three "common approaches to value" which assists the appraiser conclude this opinion or estimate. One of the three is the Cost Approach - which is how much it would cost to replace the improvements, less physical deterioration and other factors, plus the land value. The most common approach in figuring the likely sales price of a home is the Sales Comparison Approach which deals with making a comparison to comparable homes close by. Usually, the Sales Comparison Approach is the most definite indicator of market value of a home. The third approach is the Income Approach, which is the most important method in appraising income producing properties - it involves estimating what an investor would pay based on the capital produced by the property.

Describe what an appraiser does   (Return to top)

An appraiser offers a fair and credible opinion of market value, in the support of real estate transactions. Appraisers exhibit their expert conclusions in appraisal reports.


What are the reasons someone would require services from Mid Florida Appraisers, Inc.?   (Return to top)

There are many reasons to order an appraisal with the most common reason being real estate and mortgage transactions. Some other reasons for ordering an appraisal report include:
  • If you are applying for a loan.
  • To reduce your property taxes.
  • To demonstrate a homeowner's acquired equity and remove PMI.
  • To contest improperly assessed property taxes.
  • To handle an estate.
  • To give you a negotiating tool when purchasing real estate.
  • To find a reasonable price when selling real estate.
  • To protect 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 house.
  • It's possible you could be involved in a lawsuit - an appraisal will help.
For a more detailed explanation of the appraisal process click here.


Is an appraisal the same as a home inspection?   (Return to top)

Home inspectors do not figure out an opinion of value and do not do appraisal reports. An inspection is a third-party investigation of the available structure and systems of a home, from the roof to the foundation. The usual home inspector's report will contain an evaluation of the integrity of the house's heating system, 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.

My agent performed a CMA for me. Is that the same as an appraisal?   (Return to top)

Honestly, they share nothing in common. What the CMA relies upon are ill-defined trends. Appraisals use similar sales which are valid resources. The appraisal report will also contain area and building costs. All a CMA does is generate a "ball park figure." Being a documented and carefully investigated opinion of value, appraisals are defensible and stand up in legal situations.

The credentials of the person behind the report is frankly the biggest difference between a CMA and an appraisal. Real estate agents, who may not have a true grasp of valuation methods or the entire market, generate CMA's. The appraisal is created by a licensed, certified professional who has made a career out of valuing properties. Further, the appraiser is an unbiased voice, with no conditional interest in the value conclusion, unlike the real estate agent, who gets a commission based upon the price of the home.

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

Every report must indicate a believable value opinion and must identify the following:
  • The client and other intended users.
  • The intended use of the report.
  • The reason for the appraisal.
  • Precisely what "value" attribute is being reported and what that value means.
  • The effective date of the appraiser's opinions and conclusions.
  • Relevant property attributes, 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, trade fixtures and even intangible considerations.
  • All known easements, restrictions, encumbrances, leases, reservations, covenants, contracts, declarations, special assessments, ordinances, and other items of a similar nature.
  • Division of interest, such as fractional interest, physical segment and partial holding.
  • What was included in the activity of completing the appraisal.
For a more in depth view of what goes into an appraisal report click here: Sample Appraisal Report


Upon completion of the report, how can I have assurance that the final number is valid?   (Return to top)

In communicating an appraisal report, each appraiser must ensure the following:
  • That the information analysis utilized in the appraisal was suitable.

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

  • That appraisal services were rendered in a careful and judicious fashion.

  • The final appraisal report was clear, legitimate and conclusive.
There are rigorous education and practical experience requirements that must be fulfilled in order to get an appraisal license in Florida. In addition, appraisers must follow a strict 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 guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


   (Return to top) Regulations regarding licensing and certification of Real Estate Appraisers are different from state to state. In general, licensing and certification typically translates to many hours of coursework, tests and experience working under a supervisor. Once an appraiser is licensed, he or 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 do appraisers work for?   (Return to top)

Typically, appraisers are called upon by mortgage lenders to render a value opinion on real estate involved in a loan transaction. Appraisers also provide opinions for legal settlements, tax matters and investment decisions.

Where does Mid Florida Appraisers, Inc. get the information used to estimate values in Polk County or other areas?   (Return to top)

Compiling data is one of the primary activities of an appraiser. Data can be categorized as either Specific or General. Specific data is collected from the home itself; Location, condition, amenities, size and other specific data are documented by the appraiser while on site.

General data is gathered from a number of places. To find out about recently sold homes to be used as "comps", we typically go to the local Multiple Listing Service. Tax records and other courthouse documents reveal actual sales prices in a market. Appraisers often have to report when a property lies in a flood zone, so that information is retrieved from a FEMA data outlet such as a la mode's InterFlood product.

And most importantly, the appraiser gathers general data from his or her past experience in doing assignments for other houses in the same market.


Why should I hire a licensed appraiser?   (Return to top)

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 helps you set a price that maximizes profit and reduces time on the market. If you're buying, it makes sure you don't overpay. For parties settling an estate or divorce, an appraisal from Mid Florida Appraisers, Inc. is the best documentation to ensure assets are divided evenly. 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?   (Return to top)

PMI is short for for Private Mortgage Insurance. This additional policy takes care of the lender in case a borrower doesn't pay on the loan and the value of the house is less than what is owed on the loan. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.

Is PMI a part of your monthly house payment?Call Mid Florida Appraisers, Inc. today at 863-619-8287 or send us an e-mail. Documentation of your home's present value could save you thousands.

Does the appraiser need anything from me in advance?   (Return to top)

The first step in most appraisals is the property 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. 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 landscaping and move any items that would get in our way while we measure the structure. On the inside, make sure the appraiser can easily access 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:
  • A plot plan or survey of the house and land (if readily available).
  • Any paperwork, such as a title policy with information on encroachments or easements encroachments or easements.
  • Home inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, your septic system and wells.
  • Find copies of the current listing agreement, broker's data sheet and, in the event of a pending sale.
  • A bill for your most recent real estate taxes which should also contain a legal description of the property.

Define "Market Value"   (Return to top)

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?   (Return to top)

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 entitled to use the report for any other purpose without permission from the lender.

This rule doesn't apply when a home owner engages an appraiser directly. In these situations, 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 use the appraisal for any purpose.


How can I get the most ROI out of home improvements?   (Return to top)

It really depends on the market. 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.

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 were second, yielding 85%. Adding bedrooms and baths can also increase 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.