WS Watson Inc. has answers to "Frequently Asked Questions"


	WS Watson Inc. is ready to reply to any questions you might have about appraisals or real estate in Osage County. Contact us today to see how we can help solve your specific valuation problems.

What is an appraisal?
What does an appraiser do?
What are the reasons a person would require your services?
Is an appraisal the same as a home inspection?
My agent performed a CMA for me. Is that the same as an appraisal?
What's in an appraisal report?
Once the report is done, what assurance is there that the value conclusion is valid?
How are appraisers certified?
Who are an appraiser's customers?
Where does WS Watson Inc. get the information used to estimate values in Osage County or other areas?
Why should I hire a licensed appraiser?
What exactly is PMI and how can I get rid of it?
How do I get ready for the appraiser?
How does an appraiser 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?

What is an appraisal? (Go to list of questions)

The process of performing an appraisal deals with an investigation which leads to an opinion of value. This opinion or estimate is discerned by a formal process that commonly uses three "common approaches to value". One of the three is the Cost Approach - which is what it would cost to replace the improvements, minus physical deterioration and other factors, then adding the land value. The Sales Comparison Approach involves finding comparable houses nearby and finding value based on making a comparison of those houses to the property being investigated. Usually, the Sales Comparison Approach is the most accurate indicator of value of a house. The Income Approach is mainly used for finding the 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? (Go to list of questions)

An appraiser produces an impartial and well supported opinion of market value, to be used in making real estate transactions. Appraisers exhibit their analysis in appraisal reports.

What are the reasons a person would require your services? (Go to list of questions)

There are many reasons to obtain an appraisal with the most common reason being real estate and mortgage transactions. Other reasons for ordering an report include:

To receive a loan.
If you would like to reduce your property tax obligations.
To help a homeowner realize if they owe less than 80% of their home's value and remove PMI.
To contest inflated property taxes.
To settle an estate.
To provide you a leg-up when purchasing real estate.
To find an honest price when selling your home.
To ensure parties are provided just compensation in eminient domain cases.
Government agencies such as the IRS need an appraisal on every house.
It's possible you could have to deal with being in a lawsuit - an appraisal will help.

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

Is an appraisal the same as a home inspection? (Go to list of questions)

Appraisers do not do provide house inspections and are not home inspectors. A third-party home inspector will judge the structure of the home, from the roof to the bottom. For the most part, a home inspection report will evaluate the amenities and the requirements of the home: air conditioning (weather permitting), electrical functions, the condition of the heating system, the plumbing; then the structural integrity 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? (Go to list of questions)

To be blunt, it's night and day. The CMA utilizes market trends to create most of their business. The appraisal is reliant on similar verifiable comparable sales. Area and architectural prices are also precedent in an appraisal. The CMA will provide a non-specific figure. Being a documented and carefully investigated opinion of value, appraisals are defensible and stand up in legal situations.

But the biggest difference is the person behind the report. Real estate agents write 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 has made a career out of valuing properties. Further, the appraiser is an independent party, with no vested interest in the property's value, unlike the real estate agent, gets a commission based upon the price of the home.

What's in an appraisal report? (Go to list of questions)

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

The client and other intended users.
How the appraisal is supposed to be used.
The appraisal's purpose.
The type of value contained and a definition of that value.
The effective date of the value opinion.(Sometimes this is in the past or maybe the future for new construction!)
Relevant property characteristics, including: location, physical characteristics, legal attributes, economic factors, the property rights valued, 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 the like.
Division of interest, such as fractional interest, physical segment and partial holding.
The scope of work considered when completing the assignment.

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

Once the report is done, what assurance is there that the value conclusion is valid? (Go to list of questions)

In communicating an appraisal report, each appraiser must ensure the following:

The appraisal used an apropos analysis of the information.

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

That appraisal services were provided in a careful and conscientious fashion.

That a believable, substantiated appraisal report was conferred.

There are intense classroom and on the job experience requirements that must be adhered to in order to get an appraisal license in Oklahoma. In addition, appraisers must obey a stringent industry code of ethics and respect national standards of practice for real estate appraisal. The guidelines for working up an appraisal and documenting its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Go to list of questions) Licensing and certification requires classroom study, tests and practical experience. Once an appraiser is licensed, he/she is required to 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? (Go to list of questions)

Commonly, appraisers are employed by lenders to estimate the value of a home involved in a loan transaction - to make sure the real estate is indeed adequate collateral for the loan. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

Where does WS Watson Inc. get the information used to estimate values in Osage County or other areas? (Go to list of questions)

One of the primary things an appraiser does is to collect 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 documented by the appraiser during an inspection.

General data is gathered from a numerous sources. To find out about recent sales to be used as "comps", we often use the local Multiple Listing Service. Tax records and other courthouse documents verify actual sales prices in a market. Appraisers often need 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 service.

And most importantly, the appraiser assimilates general data from his or her past experience in doing assignments for other properties in the same market.

Why should I hire a licensed appraiser? (Go to list of questions)

An appraisal is a worthwhile whenever your home's value is pertinent to some financial decision. For those selling a home, you'll want to determine the price that gets you the most profit but also ensures you don't have to wait too long for a buyer to show up; an appraisal can help with that.. If you're buying, it makes sure you don't overpay. If you're engaged in an estate settlement or divorce, it ensures that property is divided fairly. Simply put. A house is often the single, largest financial asset anybody owns. Knowing its true worth means you can make wise financial decisions.

What exactly is PMI and how can I get rid of it? (Go to list of questions)

PMI stands for Private Mortgage Insurance. It protects the lender in the event a borrower is unable to pay on the loan and the value of the home is less than the loan balance. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.


	The money you keep from getting rid of your PMI will make up for the price of the appraisal in a matter of months. Nobody is more qualified than WS Watson Inc. when it comes to appreciating values in Sperry and Osage County. Contact us today.

How do I get ready for the appraiser? (Go to list of questions)

We begin with an inspection of the home. 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 status of its amenities. On the home's interior, make sure it is clutter free and that we can find our way to things like furnaces and water heaters. On the outside, trim any bushes so we can be free to get an accurate measurement of exterior walls.

You can make things 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 readily available).
Any documents, such as a title policy with information on encroachments or easements encroachments or easements.
Any "Homeowners Associations" agreements or, if applicable, condo covenants or fees .
Brag sheet that lists major home improvements and upgrades, the amount of their purchase and date of their installation (for example, the addition of central air conditioning or roof repairs) and permit confirmation (if available).
A list of "proposed" improvements if the property is to be appraised "as complete".

How does an appraiser define "Market Value"? (Go to list of questions)

Market value or fair market value is the most probable price that a property should bring (will sell for) in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, 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: (1) buyer and seller are typically motivated; (2) both parties are well informed or well advised; (3) a reasonable time is allowed for exposure to the open market; (4) payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and (5) 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? (Go to 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 certainly 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.

It's different when it's the homeowner hiring the appraiser for things outside securing a mortgage. In these scenarios, the appraiser may state how the appraisal can be used; for PMI removal, or estate planning or tax challenges, for example. If not stipulated 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? (Go to list of questions)

This really depends on where the home is.Like all things real estate, this is dependent on a home's location.A home's location - what city it is in and even what part of that city - is key to this popular question. The added value of a particular amenity truly depends on the local market.

As a rule, the best ROI 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 were second, yielding 85%. Adding bedrooms and baths can also boost the value of your home as long as your home doesn't then become an oddball for your neighborhood in terms of size.