Johnny Woody Appraisals has answers to "Frequently Asked Questions"


	Johnny Woody Appraisals is always eager to reply to any inquiries you might have about appraisals or real estate in Canton and Haywood County. Contact us today to learn how we can help solve your valuation problems.

Define the term "Appraisal"
What does an appraiser do?
What would cause me to need services from Johnny Woody Appraisals?
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 does the appraisal report contain?
Upon completion of the appraisal, what guarantee is there that the value conclusion is trustworthy?
What does it mean for an appraiser to be licensed?
Who are an appraiser's customers?
Where does Johnny Woody Appraisals get the information used to estimate values in Haywood County or other areas?
Why should I hire a licensed appraiser?
What exactly is PMI and how can I get rid of it?
Should I do anything in advance of the appraisal inspection
Define "Market Value"
Does the appraisal belong to the bank or the consumer?
I want to get more for my house. Where should I spend money renovating?

Define the term "Appraisal" (Return to top)

The method of performing an appraisal report consists of an investigation which leads to an opinion of value. The real estate appraiser will use a few "approaches," typically three, to arrive at the estimation of market value. One of the methods in use is the Cost Approach, which evaluates what it would cost to restore the improvements to the house, minus depreciation and physical deterioration, plus the land value. Another of the processes is the Sales Comparison Approach - which deals with making a comparable analysis to other similar nearby properties which have recently sold. Generally speaking, the Sales Comparison Approach is the most accurate indicator of market value of a house. The Income Approach is generally used for figuring out the market value of income-producing properties based on what an investor would pay based on the amount of capital a property would bring in.

What does an appraiser do? (Return to top)

An appraiser generates an unprejudiced and well substantiated assessment of market value, to be used in making real estate transactions. Appraisers summarize their expert analysis in appraisal reports.

What would cause me to need services from Johnny Woody Appraisals? (Return to top)

There are a lot of reasons to get an appraisal from Johnny Woody Appraisals with the usual reason being real estate and mortgage transactions. Some other reasons for ordering an report include:

If you are applying for a loan.
To reduce your tax burden.
To show a homeowner has 30% equity and remove insurance.
To challenge high property taxes.
To deal with an estate.
To give you a negotiating tool when purchasing real estate.
To find an honest price when selling your home.
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.
It's possible you could be involved in a lawsuit - an appraisal will help.

For a more extensive description of the appraisal process click here.

What is the difference between an appraisal and a home inspection? (Return to top)

Home inspectors do not produce an opinion of value and do not do appraisal reports. An inspection is a third-party evaluation of the available structure and systems of a home, from the top to the foundation. Commonly, a home inspection report will explain the amenities and the requirements of the home: air conditioning (weather permitting), electrical systems, 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.

What is the difference between an appraisal and a comparative market analysis (CMA)? (Return to top)

Simply, they have nothing in common. The CMA depends on indistinct market trends. The appraisal depends on specific valid comparable sales. Also, the appraisal looks at other factors like condition, neighborhood and construction costs. The CMA will provide a non-specific figure. Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.

Who's behind the report is frankly the biggest difference between a CMA and an appraisal. 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. The appraisal is created by a licensed, certified professional who makes a living out of valuing properties. Likewise, the agent has a vested interest in the property's selling price - their commission - whereas the appraiser is bound by a code of ethics to collect only a previously agreed upon fee for assignments, regardless of their outcome.

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

Each appraisal should indicate a supported value opinion and should clearly state the following:

The client and whose purposes the appraisal is to serve.
The intended use of the appraisal.
The reason for the appraisal.
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!)
Pertinent property characteristics, including: location, physical description, legal attributes, economic factors, the property rights valued, 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.
Any 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 job.

For a more comprehensive view of the work that goes into an appraisal report click here: Sample Appraisal Report

Upon completion of the appraisal, what guarantee is there that the value conclusion is trustworthy? (Return to top)

In the documentation of an appraisal, each appraiser must ensure the following:

The appraisal used an appropriate analysis of the data.

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

That appraisal services were not executed in a careless or negligent manner.

That a believable, supportable appraisal report was imparted.

To become a state licensed appraiser, we must fulfill considerable education and experience requirements that enable us to produce an unbiased opinion. Plus, appraisers must obey a meticulous industry code of ethics and respect national standards of practice for real estate appraisal. The rules for carrying out an appraisal and communicating its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Return to top) Licensing and certification is achieved through classroom study, tests and experience working under a supervisory appraiser. Once licensed, he/she is required to take continuing education courses so the license stays current. To see the specific requirements for any state click here.

Who are an appraiser's customers? (Return to top)

Most of the time, appraisers are hired by lenders to estimate the value of real estate involved in a loan transaction. Attorneys and CPAs also retain the services of appraisers for divorce and estate settlements.

Where does Johnny Woody Appraisals get the information used to estimate values in Haywood County or other areas? (Return to top)

One of the main activities of an appraiser is to compile property data. Data can be categorized as either Specific or General. Specific data is gathered from the property itself; Location, condition, amenities, size and other specifics are gathered by the appraiser during an inspection.

General data is gathered from a number of sources. To look up recently sold homes to be used as "comps", we often use the local Multiple Listing Service. Tax records and other public 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 assembles general data from his or her collective knowledge gained from creating appraisals for other houses in the same market.

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

An appraisal is a worthwhile whenever the value of your home is relevant to a financial decision. If you're selling your house, an appraisal helps you set a price that maximizes profit and reduces time on the market. When buying, be sure you're not overpaying by commissioning an independent appraisal. For those settling an estate or divorce, an appraisal from Johnny Woody Appraisals is the best way to ensure assets are split up fairly. Simply put, a house is often the single, largest financial asset anybody owns. Knowing its true value means you can make smart financial decisions.

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

PMI stands for Private Mortgage Insurance. PMI guards the lender in the event a borrower is unable to pay on the loan and the market price of the home is lower than the balance of the loan. 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.


	Has your real estate appreciated since you first purchased? Contact Johnny Woody Appraisals today at (828) 648-5919. You may be able to cancel your Private Mortgage Insurance premium.

Should I do anything in advance of the appraisal inspection (Return to top)

The first step in most appraisals is the property inspection. During this process, the appraiser 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. The best thing you can do to help is make sure the appraiser has easy access to the exterior of the house . 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 get to appliances like furnaces and water heaters.

You can make the inspection go faster and improve the quality of the appraisal report by having the following things on hand:

A plot plan or survey of the house and land (if available).
A list of any personal property that is part of the home and you intend to be sold with the home, such as a oven, or a washer and dryer, if applicable.
Title policy that lists encroachments or easements.
A list of any major home improvements and enhancements, the date of their installation and their cost (for example, the addition of Energy efficiency upgrades or roof repairs) and permit confirmation (if available).
A list of "proposed" improvements if the property is to be 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."

Does the appraisal belong to the bank or the consumer? (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 entitled to a copy of the report - it's usually included with all the other closing documents - but is not allowed 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 scenarios, 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.

I want to get more for my house. Where should I spend money renovating? (Return to top)

The answer to this is different depending upon the location of the home. For example, putting in an inline humidifier could be nice in arid regions, but completely useless near the coast!

As a rule, the best ROI from renovating a home comes in the kitchen. 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, something that may not increase your value would be painting just for the sake of redecorating.