Assessing Services Company, Inc. has answers to "Frequently Asked Questions"

Assessing Services Company, Inc. is always ready to address any inquiries you might have about appraisals or real estate in Oconto County. Don't hesitate to contact us today.

What is an appraisal?
Describe what an appraiser does
Why would someone request a real estate appraisal?
What is the difference between an appraisal and a home inspection?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What's in an appraisal report?
After completing the report, what assurance is there that the final number is accurate?
What are the requirements to be a certified appraiser?
Who are an appraiser's customers?
Where does Assessing Services Company, Inc. get the data used to estimate values in Oconto County or other areas?
Why do I need a professional appraisal?
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?
Who has rights to the appraisal report?
Which home renovations add the most to the price?



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

The appraisal process is an estimation that leads to an opinion of value. The real estate appraiser will typically use a few "approaches," typically three, to come to the estimation of market value. One of the processes in use is the Cost Approach, which is what it would cost to restore the improvements to the home, minus age and physical dilapidation, adding the land value. The Sales Comparison Approach involves searching for comparable houses nearby and discovering the value based on making a comparison of those prior sales to the home in question. The Sales Comparison Approach is normally the most accurate and best indicator of a liklely sales price for a residential property. The third approach is the Income Approach, which is the best method in appraising income producing properties - it deals with estimating what an investor would pay based on the income generated by the property.

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

An appraiser offers a fair and credible determination of market value, to be used in making real estate transactions. Appraisers exhibit their findings in appraisal reports.


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

There are many reasons to purchase an appraisal from Assessing Services Company, Inc. with the usual reason being real estate and mortgage transactions. Some other reasons for obtaining an report include:
  • If you are applying for a loan.
  • If you would like to reduce your property tax burden.
  • To build a case for a homeowner's equity and remove PMI.
  • To fight high property taxes.
  • To deal with an estate.
  • To offer you an edge when purchasing real estate.
  • To determine the most probable price when selling your home.
  • 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 require an appraisal on every home.
  • It's possible you could have to deal with being in a lawsuit - an appraisal will definitely help.
For a more detailed description of the appraisal process click here.


What is the difference between an appraisal and a home inspection?   (See list of FAQ's)

Appraisers do not do complete home inspections and are not home inspectors. A third-party home inspector will inspect the structure of the house, from the roof to the foundation. The standard house inspector's report will contain an evaluation of the integrity of the property's heating system, 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)

Frankly, it's like comparing sugar and saccharin. What the CMA depends on are superficial trends. The appraisal depends on similar verifiable comparable sales. The appraisal report will also contain neighborhood and construction costs. The CMA will provide a non-specific figure. An appraisal delivers a defensible and carefully documented opinion of value.

The person behind the report is actually the most significant difference between a CMA and an appraisal. A CMA is created by a real estate agent who may or may not have a true grasp of the market or valuation concepts. A certified, state licensed professional who bases a career on valuing real estate in and around Oconto County is behind the appraisal. Moreover, the appraiser is an independent party, with no conditional interest in the value of a home, unlike the real estate agent, who gets a commission based upon the price of the home.

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

Every report must reflect a supported estimate of value and should identify 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 appraisal.
  • The type of value contained and a definition of that value.
  • The effective date of the appraisal.
  • Characteristics of the property that have a bearing on the value, including: location, physical attributes, legal attributes, economic attributes, the real property interest valued, and non-real estate items included in the valuation, such as personal property, trade fixtures and even intangible factors.
  • 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 detailed view of the work that goes into an appraisal report click here: Sample Appraisal Report

After completing the report, what assurance is there that the final number is accurate?   (See list of FAQ's)

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

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

  • That appraisal services were not rendered in a careless or negligent fashion.

  • The final appraisal report was transparent, sound and not easily discredited.
To become a state licensed appraiser, there are strenuous education requirements as well as practical experience that must be attained - all with the end goal of gaining the skills required to render unbiased value opinions. Likewise, appraisers must obey a stringent industry code of ethics and observe 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).


    (See list of FAQ's) Regulations regarding licensing and certification vary from state to state. However, licensing and certification typically translates to many hours of classroom study, tests and real world experience. Once licensed, he or she must then engage in continuing education courses so that the license doesn't expire. To see the specific requirements for any state click here.

Who are an appraiser's customers?   (See list of FAQ's)

Mortgage lenders are an appraiser's typical client, using their services to ensure real estate involved in a mortgage transaction is enough to cover a loan balance in the case of default. Appraisers also provide opinions for legal settlements, tax matters and investment decisions.

Where does Assessing Services Company, Inc. get the data used to estimate values in Oconto County or other areas?   (See list of FAQ's)

Collecting data is one of the primary tasks an appraiser engages in. Data can be divided into Specific or General. Specific data is collected from the property itself; Location, condition, amenities, size and other specific data are gathered by the appraiser during an inspection.

General data is received from a many sources. Local Multiple Listing Services (MLS) have data on recently sold homes that might be used as comparables. Tax records and other public documents verify actual sales prices in a market. Appraisers often need to report when a property lies in a flood zone, and that information is retrieved from a FEMA data outlet such as a la mode's InterFlood product.

And last but not least, the appraiser gathers general data from his or her past experience in doing assignments for other properties in the same market.

Why do I need a professional appraisal?   (See list of FAQ's)

If you're involved in some sort of financial decision and the value of your home matters, you'll want a full appraisal. If you're selling your house, an appraisal assists you in setting the most appropriate price. When buying, be sure you're not overpaying by commissioning 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. Knowing its true value means you can make 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 an acronym for Private Mortgage Insurance. This supplemental plan takes care of the lender in the event a borrower is unable to pay on the loan and the value of the property is less than the balance of the loan. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.

The savings from dropping the PMI required when you got your mortgage will make up for the cost of the appraisal in no time. Assessing Services Company, Inc. stays current with real estate value trends in Lakewood and Oconto County. Contact us today.

Should I do anything in advance of the appraisal appointment   (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. The best thing you can do to help is make sure the appraiser has easy access to the exterior of the house (gates aren't locked, etc). Trim any bushes and relocate 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.

To help speed things along as well as ensure a more accurate report, attempt if possible to have the following items:
  • Records on the latest purchase of the property in the last three years.
  • List of personal property to be sold with the building.
  • Title policy that lists encroachments or easements.
  • Any inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, your septic system and wells.
  • Information on "Homeowners Associations" or condominium covenants and fees.

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."

Who has rights to the appraisal report?   (See list of FAQ's)

For mortgage transactions, the lender orders 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 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.

The exception to this rule is when a home owner hires 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 stipulated 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)

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 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 most value returned 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%. On the contrary, something that may not increase your value would be painting just for the sake of redecorating.