Frequently Asked Questions

Why Hire an Appraiser?

Think of an appraisal as an investment for your future. It is imperative to know what your property is worth, so that you can make a sound, educated financial decision.

If you're involved in any kind of financial decision and the value of your home matters, you'll want an appraisal.

For example:

  • When selling your house, an appraisal will help you determine the most appropriate price.

  • When buying, you can avoid overpaying by commissioning an independent appraisal.

  • For parties settling an estate or divorce, an appraisal from Top Corner Appraisal is the best documentation to ensure assets are split up evenly.

  • Simply put, a house is often the single, largest financial asset anybody owns. Knowing its true value is essential to making smart financial decisions.

When Would I Need an Appraisal?

There are many reasons to purchase an appraisal with the most common reason being real estate and mortgage transactions. Some other reasons for ordering an appraisal include:

  • To receive a loan.

  • To lower your property taxes.

  • To demonstrate a homeowner's acquired equity and remove Primary Mortgage Insurance.

  • To challenge inflated property taxes.

  • If you need to take care of an estate.

  • To offer you a leg-up when purchasing a home.

  • To figure out a reasonable property value when listing your home.

  • To protect your rights if your property is being taken by means of eminent domain in a condemnation case.

  • Because a government agency such as the IRS requires it.

It's possible you could have to deal with being involved in a lawsuit - an appraisal will definitely help.

What is the Job of an Appraiser?

One of the main tasks an appraiser performs is to compile data. Data can be classified as either Specific or General.

Specific data is collected from the home itself; Location, condition, amenities, size and other specifics are noted by the appraiser while on site. General data is gathered from a variety of sources. Local Multiple Listing Services (MLS) have information on recently sold homes that could be used as comparables. To verify actual sales prices, we research tax records and other public documents. Appraisers routinely 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 service. And last but not least, the appraiser assembles general data from his or her past experience in creating appraisals for other properties in the same market.

Only a portion of the process is done on-site where the appraiser will:

  • Exterior measurements and photos will be taken of the home as well as any out buildings.

  • Walk the length of the property to determine exterior condition.

  • Evaluate all amenities such as out buildings, swimming pool, finished area above garages

  • Conduct a room-by-room walk-through to determine interior condition, taking interior photos and noting features of the home that will influence the value.

  • Note any health or safety issues.

  • Record the layout of the property.

Off-site, the appraiser will also evaluate the current real estate market in the neighborhood to help determine the value of the property.

How Do You Know if an Appraiser is Qualified?

There are intense education and on the job experience requirements that must be fulfilled in order to get an appraisal license in Colorado. In addition, appraisers must abide by a strict industry code of ethics and observe national standards of practice for real estate appraisal. The rules for working up an appraisal and documenting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP). Regulations regarding licensing and certification of Real Estate Appraisers are different from state to state. In general, licensing and certification is most often associated with many hours of coursework, tests and practical experience. Once licensed, the appraiser is required to engage in continuing education courses so that the license doesn't expire.

A qualified Real Estate Appraiser should be state-licensed or state-certified as they are governed by USPAP. The Uniform Standards of Professional Appraisal Practice is the generally recognized ethical and performance standards for the appraisal profession in the United States. Compliance is required for state-licensed and state-certified appraisers involved in federally-related real estate transactions. USPAP is updated every two years so that appraisers have the information they need to deliver unbiased and thoughtful opinions of value.

Who Hires The Appraiser?

For an independent opinion of value for a residential property that is not associated with a financial institution, you personally would be responsible for the hiring and payment of the appraisal.

If you are working with a financial institution, your lender will choose the appraiser. The lender will have a list of reputable appraisers whom they have hired in the past. Typically, a financial institution will NOT accept an outside appraisal, so make sure to understand the process before you explore hiring an independent appraiser.

How long does an Appraisal take?

One hour is the average time spent at the property as most of the work is completed out in the field and back at the appraiser’s office.

Most likely, the appraisal should be delivered within three to seven business days after the observation.

The amount of time it takes to complete the appraisal report will depend on the size of property and complexity of the process.

What Can I Expect To See In My Appraisal Report?

Each appraisal must reflect a credible estimate/opinion of value and will identify the following:

  • Who engaged the appraiser and other intended users.

  • How the appraisal is supposed to be used.

  • The appraisal's purpose.

  • Precisely what "value" attribute is being reported and what that value means.

  • The effective date of the value opinion.

  • Characteristics of the property that have a bearing on the value, including: location, physical attributes, legal attributes, economic attributes, the property rights in question, and non-real estate items included in the valuation, such as personal property, permanent equipment installations and even intangible considerations.

  • 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 included in the process of completing the job.

What Is Market Value?

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 Owns The Appraisal Report?

In most real estate transactions, the appraisal is ordered by the lender. Even though it's the buyer that eventually pays for the report, the lender is the intended user. The buyer is certainly entitled to a copy of the appraisal - 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 engages an appraiser directly. In these situations, the appraiser may state how the appraisal can be used; 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.

How Do I Get The Most Out Of My Appraisal?

Like all things real estate, this is dependent on a home's location. For example, while quality appliances are attractive, a $7000 built-in refrigerator won't pay off in a neighborhood of moderately priced homes.

As a rule, the most value returned 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 were second, yielding 85%. On the contrary, an improvement that may not increase your value would be painting just for the sake of redecorating.

What Should I Do To Prepare For An Appraisal?

1. Clean Up Your Yard For Curb Appeal

  • Walk out front and look at your home with fresh eyes. Are there weeds in the yard or driveway? Are there children’s toys or other clutter on the lawn? These are all minor issues you can take care of rather quickly.

  • Tidying up can help improve the value of your home and can help make it appear larger.

  • Create a home appraisal checklist in the weeks leading up to your appointment. Then do a few projects or repeat some tasks each week.

  • Leading up to your home appraisal, consider watering your outdoor plants a bit more. Don’t have time for that? Then maybe adding a few new plants in pots or the ground can bring some new life to your home’s exterior.

  • Be sure to check for any chipping paint that you could touch up if you have the supplies. Cleaning your windows’ exterior can make a difference, as well as sweeping or hosing down any sidewalks or driveways is a great added touch.

  • Keep some of these minor touch-ups in mind for the interior of your home too. And remember: a decluttered and clean home will feel more expensive.

2. Don’t Hover

  • During the home appraisal, don’t follow the appraiser around too much. Some appraisers have said it can make them think there is something wrong with the home. Be available to answer questions but allow them to do their job.

If you can’t watch them the whole time, what do appraisers look for?                                                                                                                                                                         

  • Appraisers are looking for the overall structure of the home to gauge the quality of the build.

  • The size of the property will be factored into the total value.

  • Also, the upkeep of the interior and exterior features help tell the story of the home.

3. Keep a List of Repairs and Upgrades

  • Organizing a list of repairs and upgrades is something you should do whether you’re thinking about an appraisal or not – you can point them out, along with any other special features of your home, to the appraiser.

  • Enclosed garages, fireplaces, pools, and things of the like increase the value of a home.

  • Plus, by showing the appraiser your list of repairs, it makes it easy for them to see the time and care you’ve put into your home.

  • Check this list for common repairs such as:

  • Loose Floor Boards

  • Leaky Roof

  • Functioning Door Bell

  • Rain Gutters

  • Replace Bathroom Caulk

  • Dripping Pipe or Faucet

4. Double Check The Basics

  • Having lights, doors, or windows not working can affect your home’s effective age. Basically, if elements in your home are in disrepair, their perceived age will be higher. Then it’s put into a category with older homes and loses value.

  • It’s much better to have your home grouped with newer homes as the value will increase.

  • Think of these small repairs as the tipping point. If the appraiser sees lights or doors not functioning properly, they may wonder if the homeowner has kept up with larger home repairs.

5. The $500 Rule

  • The home appraisal process doesn’t have a hard rule on how much a home’s price increases or decreases in value.

  • However, appraisers often measure home value in $500 increments. If your home needs some relativity-minor repairs, they’ll hurt your appraisal. Fix or replace all non-functioning door latches or handles, torn window screens, and even worn-out carpet. Also, make sure basic plumbing and light fixtures function correctly.

  • While appraisers don’t fully inspect plumping, they’ll note if there are issues found during their visit.

  • Think of it this way: If you spend around $500 or less to do some of these simple fixes, it increases the value of your home because a well-maintained home holds more worth. Possibly even more than the amount you spent.

6. Safety Equipment is Installed and Working

  • Make sure to check your safety devices. Like the batteries in your smoke alarms, carbon monoxide alarms, or home security alarm.

  • Remember to check the expiration date on your fire extinguisher, too.

7. Change What Will Add The Most Value

  • The kitchen and bathroom hold the biggest opportunity for return on investment.

  • In a study sponsored by the National Association of Realtors, G. Stacy Sirmans reviewed 150 variables that affect home value. The Professor of real estate at Florida State University discovered that the kitchen and bathroom held the most weight toward a higher home value.

  • Some other elements that greatly increased the home’s worth are wood floors, landscaping, and an enclosed garage.

8. Basement vs Attic – Which Has A Bigger Return?

  • Wondering how to increase home value? Maybe you’re considering remodeling a basement or attic?

  • One important thing to remember is that anything below the grade, basically the ground or foundation, aren’t factored into square footage. Therefore, an updated basement won’t be factored into an appraisal the same as a repurposed attic.

  • A study found a basement had a 66% return on a remodel, whereas an attic has 73%.

  • However, potential buyers may like the idea of a fun game room, man cave, or guest room in a basement. It just won’t help much for your home appraisal.

9. Make The Appraiser’s Visit A Pleasant One

  • Make sure the appraiser feels comfortable. Is it a hot or cold day? Make sure to set your air conditioning or heater to a comfortable temperature. Even turning on some fans can make a difference.

  • While candles are nice, be wary since everyone prefers different scents and some have allergies. Perhaps light a candle or two and make sure to blow it out an hour or two before your appraiser arrives so the scent is more subtle.

  • If you have pets, make sure to leash them or see if a friend can watch them for a few hours.

  • Don’t go over the top, but doing the simple things, like the above, will make them feel more comfortable.

10. Remember Your Neighborhood

  • It’s important that your surrounding area is factored into your appraisal.

  • What improvements have happened since you moved in? Was a new school, restaurant, or community park built? Note if your roads have been recently re-paved.

  • What is within 10 miles of your home? A luxury shopping center, university, or sports stadium can all affect the perceived value of your home.