profile picture

Swearingen Realty Company has answers to "Frequently Asked Questions"

Swearingen Realty Company is happy to answer any concerns you might have about appraisals in Colonial Heights City County. Feel free to contact us today.

Describe an appraisal
Describe what an appraiser does
Why would someone require a real estate appraisal?
How is an appraiser different than a home inspector?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What can I expect to see in my appraisal report?
Once the appraisal is done, what guarantee is there that the value conclusion is legitimate?
How difficult is it to become certified?
Who do appraisers work for?
Where does Swearingen Realty Company get the data used to estimate values in Colonial Heights City 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?
Do you need anything from me in advance?
Define "Market Value"
Who actually owns the appraisal report?
I want to get more for my house. Where should I spend money renovating?



Describe an appraisal   (See list of FAQ's)

The procedure of creating an appraisal consists of an investigation which leads to an opinion of value. There are three "common approaches to value" which assists the appraiser conclude this opinion or estimate. One of the processes 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 Sales Comparison Approach involves searching for similar properties in close proximity and finding value based on comparing those prior sales to the home in question. The Sales Comparison Approach is commonly the most definitive and best indicator of value for a home. The third approach is the Income Approach, which is the most important method in appraising income producing properties - it deals with estimating what an investor would pay based on the income produced by the property.

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 purchase. Appraisers illustate their analysis in appraisal reports.


Why would someone require a real estate appraisal?   (See list of FAQ's)

There are a lot of reasons to purchase an appraisal from Swearingen Realty Company with the usual reason being real estate and mortgage transactions. A few other reasons for getting an report include:
  • If you are applying for a loan.
  • To reduce your tax burden.
  • To build a case for a homeowner's equity and remove insurance.
  • To fight inflated property taxes.
  • If you need to take care of an estate.
  • To offer you an edge when purchasing real estate.
  • To figure out a reasonable sales price when putting your home on the market.
  • To defend your rights if your property is being taken by means of eminent domain in a condemnation case.
  • Because an official agency such as the IRS requires it.
  • If you ever find yourself in a lawsuit.
Click here for a more extensive explanation of the process dealing with getting an appraisal.


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

The appraiser is not a home inspector and does not do a comprehensive home inspection. An inspection is a third-party investigation of the accessible structure and systems of a house, from the top to the foundation. The general property inspector's report will include an evaluation of the condition of the property's heating systems, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and visible 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)?   (See list of FAQ's)

To be blunt, it's night and day. The CMA relies on indefinite market trends. An appraisal utilizes comparable sales that can be verified by public record. Location and building costs are also a priority in an appraisal. All a CMA does is generate a "ball park 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 most significant 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 makes a living out of valuing properties. Further, the appraiser is an unbiased voice, with no conditional interest in the value of a home, unlike the agent, who gets a commission based upon the price of the home.

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

Every report must indicate a credible value opinion and should identify the following:
  • The client and whose purposes the appraisal is to serve.
  • The intended use of the appraisal.
  • The appraisal's purpose.
  • Precisely what "value" attribute is being reported and what that value means.
  • The effective date of the appraisal.(Sometimes this is in the past or maybe the future for new construction!)
  • Relevant property characteristics, including: location, physical description, legal attributes, economic factors, the real property interest in question, and non-real estate items included in the appraisal, such as personal property, permanent equipment installations 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 included in the process of completing the assignment.
For a more detailed look at what goes into an appraisal report click here: Sample Appraisal Report


Once the appraisal is done, what guarantee is there that the value conclusion is legitimate?   (See list of FAQ's)

In the documentation of an appraisal, each appraiser must see to it that each of the items below are covered:
  • The appraisal contained a suitable analysis of the data.

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

  • That appraisal services were provided in a careful and cognizant fashion.

  • That a credible, supportable appraisal report was imparted.
To become a state licensed appraiser, there are strenuous education requirements as well as real world experience that must be logged. In addition, appraisers must follow a stringent industry code of ethics and respect national standards of practice for real estate appraisal. The rules for carrying out 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 vary from state to state. In general, licensing and certification is most often associated with many hours of coursework, tests and real world experience. Once an appraiser is licensed, he or she must then 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?   (See list of FAQ's)

Mortgage lenders are an appraiser's most likely customer, requesting their services to ensure a home involved in a mortgage transaction is adequate collateral for a loan. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

Where does Swearingen Realty Company get the data used to estimate values in Colonial Heights City County or other areas?   (See list of FAQ's)

One of the main activities of an appraiser is to collect property data. Data can be divided into Specific or General. Specific data is taken from the home itself; Location, condition, amenities, size and other specific data are gathered by the appraiser while on site.

General data is gathered from a many places. To find out about recently sold homes to be used as "comps", we typically go to the local Multiple Listing Service. To double-check actual sales prices, we research items in the assessor's office and other public documents that are usually online nowadays. Flood zone data is gathered from FEMA data outlets, such as a la mode's InterFlood system.

And most importantly, the appraiser assimilates general data from his or her collective knowledge gained from creating appraisals for other properties 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. When selling your house, an appraisal helps you set the most appropriate price. If you're buying, it makes sure you don't overpay. For parties settling an estate or divorce, an appraisal from Swearingen Realty Company is the best documentation to ensure assets are divided fairly. Simply put, a home is often the single, largest financial asset anybody owns. Knowing its true value is essential to making wise 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 plan covers the lender in case a borrower doesn't pay on the loan and the market price of the house is lower than what the borrower still owes on the loan. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.

The amount you keep from dropping your PMI pays for the appraisal in no time. Swearingen Realty Company has years of experience with value trends in Colonial Heights and Colonial Heights City County. Contact us today.

Do you need anything from me in advance?   (See list of FAQ's)

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 . Trim any shrubs and move any items that would get in our way while we measure the structure. Indoors, make sure we can easily access items like furnaces and water heaters.

You can make our visit go faster and improve the quality of the appraisal report by having the following things on hand:
  • Any information on the purchase of the property for the last three years.
  • Any documents, 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.
  • Brag sheet that lists major home improvements and enhancements, the amount of their purchase and date of their installation (for example, the addition of Insulation or roof repairs) and permit confirmation (if available).
  • Most recent real estate tax bill and or legal description of the property.

Define "Market Value"   (See list of FAQ's)

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 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 entitled to a copy of the report - 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 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 stated otherwise, the home owner can do whatever they want with the appraisal.


I want to get more for my house. Where should I spend money renovating?   (See list of FAQ's)

A home's location - what city it is in and even what part of that city - is key to this popular question. 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 move. 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%. On the contrary, an improvement that may not increase your value would be painting just for the sake of redecorating.