Blum Appraisal Service LLC has answers to "Frequently Asked Questions"


	Blum Appraisal Service LLC is eager to answer any questions you might have about appraisals or real estate in Bexar County. Contact us today to see how we can help solve your specific valuation problems.

Define the term "Appraisal"
What does an appraiser do?
What are the reasons someone would need a real estate appraisal?
What is the difference between an appraisal and a home inspection?
My agent performed a CMA for me. Is that the same as an appraisal?
What are the contents of an appraisal report?
After completing the report, how can I have assurance that the value indicated is valid?
How are appraisers certified?
Who employs appraisers?
Where does an appraiser get the data used to estimate values in Bexar County or other areas?
What can a full appraisal do for me?
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?
I want to get more for my house. Where should I spend money renovating?

Define the term "Appraisal" (List of questions)

An appraisal report is an investigation leading to an opinion of value. This opinion or estimate is concluded by using a formal process that typically uses three "common approaches to value". One of the processes is the Cost Approach - which is what it would cost to replace the improvements, minus physical deterioration and other factors, plus the land value. The Sales Comparison Approach involves searching for comparable houses nearby and discovering the value based on comparing those houses to the property being appraised. Generally speaking, the Sales Comparison Approach is the most accurate indicator of market value of a residential property. The Income Approach is generally used for finding the market value of income-producing properties based on what an investor would pay based on the amount of capital a property produce.

What does an appraiser do? (List of questions)

An appraiser forumlates a professional, unbiased assessment of market value, in the support of real property exchanges. Appraisers illustate their conclusions in appraisal reports.

What are the reasons someone would need a real estate appraisal? (List of questions)

There are many reasons to get an appraisal from Blum Appraisal Service LLC with the most common reason being real estate and mortgage transactions. Other reasons for ordering an appraisal 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 challenge inflated property taxes.
To deal with an estate.
To provide you a leg-up when purchasing a home.
To find the most probable property value when listing your home.
To ensure parties are provided just compensation in eminient domain cases.
Because an official agency such as the IRS requires it.
It's possible you could have to deal with being in a lawsuit - an appraisal will definitely help.

Click here for a more extensive explanation of the process about getting an appraisal.

What is the difference between an appraisal and a home inspection? (List of questions)

Home inspectors do not estimate an opinion of value and do not do appraisal reports. An inspection is a third-party investigation of the available structure and electrical and mechanical systems of a home, from the roof to the bottom. Commonly, a home inspection report will discuss the amenities and the necessities of the house: 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.

My agent performed a CMA for me. Is that the same as an appraisal? (List of questions)

To be blunt, it's apples and oranges. The CMA depends on indefinite local market trends. An appraisal relies on comparable sales that can be proven by public record. Location and building prices are also important in an appraisal. All a CMA does is generate a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

But the largest differentiator is the person doing the report. A CMA is written by a real estate agent who may or may not be trained in technical valuation concepts or even have a handle on market trends. A certified, Texas licensed professional who has formed a career on valuing homes in and around Bexar County creates the appraisal. Further, the appraiser is an independent party, with no conditional interest in the property's value, unlike the agent, whose income is tied to the price of the home.

What are the contents of an appraisal report? (List of questions)

Each report must indicate a credible estimate of value and must clearly state the following:

The client and other intended users.
How the appraisal is supposed to be used.
The reason for the appraisal.
The type of value contained 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!)
Characteristics of the property that have a bearing on the value, including: location, physical characteristics, legal attributes, economic factors, the real property interest in question, and non-real estate items included in the valuation, such as personal property, trade fixtures 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.
What was involved in the activity of completing the appraisal.

For a more detailed look at all that goes into an appraisal report click here: Sample Appraisal Report

After completing the report, how can I have assurance that the value indicated is valid? (List of questions)

In the documentation of an appraisal, each appraiser must see to it that each of the items below are covered:

That the information analysis contained in the appraisal was suitable.

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

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

The final appraisal report was easy to explain, credible and defensible.

To become a state licensed appraiser, there are extensive education requirements as well as real world experience that must be attained - all with the objective of gaining the skills required to render unbiased value opinions. In addition, appraisers must follow a meticulous industry code of ethics and observe 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).

(List of questions) Regulations regarding licensing and certification are different from state to state. However, licensing and certification typically translates to many hours of coursework, tests and practical experience. Once licensed, he/she must then complete continuing education courses so the license remains up to date. To see the specific requirements for any state click here.

Who employs appraisers? (List of questions)

Mortgage lenders are an appraiser's most likely client, using their services to ensure property 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 an appraiser get the data used to estimate values in Bexar County or other areas? (List of questions)

One of the primary activities of an appraiser is to collect property data. Data can be classified as either Specific or General. Specific data is collected from the property itself; Location, condition, amenities, size and other specifics are noted by the appraiser during an inspection.

General data is gathered from a many places. To find out about recently sold homes to be used as "comps", an appraiser will typically go to the local Multiple Listing Service. Tax records and other public documents reveal actual sales prices in a market. Appraisers routinely have to report when a property is 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 collective knowledge gained from doing assignments for other properties in the same market.

What can a full appraisal do for me? (List of questions)

If you're making 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 will help you determine a price that maximizes profit and reduces time on the market. If you're buying, it makes sure you don't overpay. For people settling an estate or divorce, an appraisal from Blum Appraisal Service LLC is the best way to ensure assets are divided evenly. A home 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? (List of questions)

PMI is the common abbreviation for for Private Mortgage Insurance. It takes care of the lender in case a borrower doesn't pay on the loan and the market price of the property is less than what the borrower still owes on 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 home value appreciated since you first purchased? Contact Blum Appraisal Service LLC today at (210) 725-8714. You may be able to get rid of your Private Mortgage Insurance payment.

Does the appraiser need anything from me in advance? (List of questions)

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 shrubs and move any items that would get in our way while we measure the structure. On the inside, make sure the appraiser can get to 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 survey or plot map of the property and building (if readily available).
Written property agreements, such as a maintenance agreement for a shared driveway.
Most recent real estate tax bill from Bexar and or legal description of the property.
Any inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, septic systems and your well.
Information on "Homeowners Associations" or condominium covenants and fees.

Define "Market Value" (List of questions)

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? (List of questions)

For mortgage transactions, the lender requests the appraisal, either directly or through a third party. Even though it's the buyer that eventually pays for the report, the lender is the intended user. 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.

It's different when it's the homeowner engaging the appraiser for things outside securing a mortgage. In these scenarios, the appraiser may stipulate the purpose of the appraisal; for PMI removal, or estate planning or tax challenges, for example. If not noted 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? (List of questions)

A home's location - what city it is in and even what part of that city - is key to this popular question. For example, installing an inline humidifier could be nice in arid regions, but completely useless near the coast!

No matter where you go, however, renovating a kitchen is almost always a safe investment. 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 were second, yielding 85%. Adding bedrooms and baths can also help the value of your home as long as your home doesn't then become overbuilt for your neighborhood in terms of size.