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Skyward Appraisal, Inc. has answers to "Frequently Asked Questions"

Skyward Appraisal, Inc. is prepared to handle any questions you might have about appraisals in Vancouver and Clark County. Feel free to contact us today.

What is an appraisal?
What does an appraiser do?
Why would I require your services?
How is an appraiser different than a home inspector?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What does the appraisal report contain?
Upon completion of the appraisal, how can I have certainty that the value conclusion is accurate?
What goes into an appraiser's certification?
Who do appraisers work for?
Where does an appraiser get the information used to estimate values in Clark County or other areas?
Why should I hire a licensed appraiser?
What exactly is PMI and how can I get rid of it?
How do I get ready for the appraiser?
Define "Market Value"
Who has rights to the appraisal report?
Are some home improvements more worthwhile than others?



What is an appraisal?   (Return to top)

The procedure of performing an appraisal deals with an evaluation which leads to an opinion of value. The real estate appraiser must use a number of "approaches," typically three, to come to the estimation of market value. One of them is the Cost Approach - which is how much capital would be required to replace the improvements, minus physical deterioration and other factors, then adding the land value. The Sales Comparison Approach involves searching for similar properties in the vicinity and discovering the value based on comparing those homes to the home in question. Being the most common approach, the Sales Comparison Approach is generally the most accurate and best indicator of market value for a home. The Income Approach is mainly 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 would bring in.

What does an appraiser do?   (Return to top)

An appraiser offers an objective and well justified determination of market value, often in the context of a real estate exchange. Appraisers show their expert investigation in appraisal reports.


Why would I require your services?   (Return to top)

There are many reasons to order an appraisal from Skyward Appraisal, Inc. with the usual reason being real estate and mortgage transactions. Other reasons for obtaining an appraisal include:
  • If you are applying for a loan.
  • To lower your tax burden.
  • To show a homeowner has 30% equity and remove insurance.
  • To challenge high property taxes.
  • If you need to settle an estate.
  • To offer you an edge when purchasing real estate.
  • To figure out a likely property value when selling real estate.
  • To ensure parties are provided just compensation in eminient domain cases.
  • Government agencies such as the IRS need an appraisal on every property.
  • If you ever find yourself in a lawsuit.
Click here for a more detailed explanation of the process dealing with getting an appraisal.


How is an appraiser different than a home inspector?   (Return to top)

Appraisers do not do complete home inspections and are not home inspectors. The point of a home inspection is to investigate the structure of the property from basement to top. The standard 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 accessible 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)?   (Return to top)

Frankly, it's night and day. The CMA uses market trends to create most of their business. The appraisal relies on similar verifiable comparable sales. The appraisal report will also contain location and construction prices. The CMA will provide a non-specific figure. Being a documented and carefully investigated opinion of value, appraisals are defensible and stand up in legal situations.

But the biggest difference is who's doing 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, Washington licensed professional who made their livelihood on valuing real estate in and around Clark County creates the appraisal. Moreover, the appraiser is an unbiased party, with no vested interest in the value of a home, unlike the agent, whose income is tied to the price of the home.

What does the appraisal report contain?   (Return 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:
  • The client and other intended users.
  • How the appraisal is supposed to be used.
  • The appraisal's purpose.
  • The type of value reported and a definition of the value reported.
  • The effective date of the value opinion.(Sometimes this is in the past or maybe the future for new construction!)
  • Pertinent property attributes, including: location, physical description, legal attributes, economic factors, the real property interest in question, and non-real estate items included in the valuation, such as personal property, items that are more or less permanently installed and even intangible items.
  • 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.
  • The scope of work considered while working up the appraisal.
For a more comprehensive view of all that goes into an appraisal report click here: Sample Appraisal Report


Upon completion of the appraisal, how can I have certainty that the value conclusion is accurate?   (Return 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.

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

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

  • The final appraisal report was clear, credible and not easily discredited.
To become a state licensed appraiser, there are education requirements as well as on the jobexperience that must be logged. In addition, appraisers must follow a stringent industry code of ethics and comply with national standards of practice for real estate appraisal. The rules for carrying out an appraisal and documenting its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


   (Return to top) Licensing and certification requires coursework, tests and experience working under a supervisory appraiser. Once licensed, he or she is required to complete continuing education courses in order to keep the license up to date. To see the specific requirements for any state click here.

Who do appraisers work for?   (Return to top)

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

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

One of the main things an appraiser does is to gather property data. Data can be divided into Specific or General. Specific data is taken from the property itself; Location, condition, amenities, size and other specifics are documented by the appraiser during an inspection.

General data is collected from a many sources. To research recent sales to be used as "comps", an appraiser will often use the local Multiple Listing Service. To double-check actual sales prices, we look at tax records and other public documents. Flood zone data is gathered from FEMA data outlets, such as a la mode's InterFlood servers.

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


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

An appraisal is a valuable tool whenever the value of your home is pertinent to a financial decision. For those selling a home, you'll want to figure out the price that gets you the most profit but also ensures you don't have to wait too long for a buyer to show up; an appraisal can help with that. When buying, you can avoid overpaying by getting 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. Without knowing its real value, wise financial decisions are impossible.


What exactly is PMI and how can I get rid of it?   (Return to top)

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 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.

Is PMI a part of your monthly mortgage payment?Call Skyward Appraisal, Inc. today at (360) 546-1321 or send us an e-mail. A current appraisal could save you thousands.

How do I get ready for the appraiser?   (Return to top)

We start with an inspection of the home. 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, pick up any clutter and make sure we can get to things like furnaces and water heaters. On the outside, 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:
  • Records on the latest purchase of the property in the last three years.
  • Any paperwork, 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, septic systems and wells.
  • Brag sheet that lists major home improvements and enhancements, the date of their installation and their cost (for example, the addition of central air conditioning or roof repairs) and permit confirmation (if available).
  • A list of "suggested" improvements when the property is being appraised "as complete".

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)

For mortgage transactions, the lender requests the appraisal, either directly or through a third party. 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 allowed 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 cases, the appraiser may stipulate 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.


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

This really depends on where the home is. For example, while quality appliances are attractive, a $7000 built-in refrigerator won't pay off in a neighborhood of moderately priced homes

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 weren't far behind, returning 85%. On the contrary, work that may not add value would be painting just for the sake of redecorating.