NIckey J. Duhon, Real Estate Appraiser has answers to "Frequently Asked Questions"


	NIckey J. Duhon, Real Estate Appraiser is ready to elaborate on any concerns you might have about appraisals or real estate in Lafayette and Lafayette County. Contact NIckey J. Duhon, Real Estate Appraiser today to talk about how we can help you with your specific valuation problems.

Describe an appraisal
Describe what an appraiser does
What would cause me to request services from NIckey J. Duhon, Real Estate Appraiser?
Is an appraisal the same as a home inspection?
Is an appraisal the same as a comparative market analysis(CMA)?
What can I expect to see in my appraisal report?
After completing the appraisal, what assurance is there that the value indicated is trustworthy?
How difficult is it to become certified?
Who hires NIckey J. Duhon, Real Estate Appraiser
Where does an appraiser get the data used to estimate values in Lafayette County or other areas?
Why do I need a professional appraisal?
What exactly is PMI and how can I get rid of it?
Do you need anything from the homeowner in advance?
What is "Market Value?"
Who has rights to the appraisal report?
Are some home improvements more worthwhile than others?

Describe an appraisal (Back to top)

The appraisal process is an estimation that produces an opinion of value. There are three "common approaches to value" which helps the real estate appraiser come to this opinion or estimate. The Cost Approach is one of the approaches that real estate appraisers use to find the value of a home; it involves discerning what the improvements would cost without physical deterioration, adding the land value. Another of the methods is the Sales Comparison Approach - which concerns finding a comparable analysis to other similar properties within a close proximity which have recently sold. The Sales Comparison Approach is commonly the most accurate and clearest indicator of a liklely sales price for a residence. The third approach is the Income Approach, which is of most importance in appraising income producing properties - it involves estimating what an investor would pay based on the capital generated by the property.

Describe what an appraiser does (Back to top)

An appraiser provides a professional, unbiased opinion of market value, often in the context of a real estate purchase. Appraisers present their professional analysis in appraisal reports.

What would cause me to request services from NIckey J. Duhon, Real Estate Appraiser? (Back to top)

There are many reasons to get an appraisal from NIckey J. Duhon, Real Estate Appraiser with the most common reason being real estate and mortgage transactions. A few other reasons for obtaining an report include:

If you are applying for a loan.
If you would like to lower your property tax obligations.
To help a homeowner realize if they owe less than 80% of their home's value and remove PMI.
To challenge improperly assessed property taxes.
To deal with an estate.
To provide you a leg-up when purchasing real estate.
To determine a reasonable sales price when listing your home.
To defend 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 house.
If you are ever involved in a civil case.

Click here for a more detailed explanation of the process dealing with getting an appraisal.

Is an appraisal the same as a home inspection? (Back to top)

Home inspectors do not come to an opinion of value and do not use the same forms as appraisers. An inspection is a third-party investigation of the accessible structure and mechanical systems of a home, from the top to the bottom. Generally, a home inspection report will discuss the amenities and the necessities of the house: air conditioning (weather permitting), electrical services, the condition of the heating system, the plumbing; then the structural capacity of the home such as the attic, visible insulation, walls, floors, ceilings, windows, then the foundation, basement and other visible structures.

Is an appraisal the same as a comparative market analysis(CMA)? (Back to top)

Frankly, it's like comparing opera to country. The CMA depends on indistinct trends in the market. An appraisal relies on comparable sales that can be validated by public record. In addition, the appraisal verifies other factors like condition, neighborhood and replacement costs. 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 largest differentiator is the person behind the report. Real estate agents, who may not have a true grasp of valuation methods or the entire market, generate CMA's. The appraisal is produce by a licensed, certified professional who has made a career out of valuing properties. Likewise, the agent has something at stake since they get a commission based on the property's selling price - their commission - whereas the appraiser is bound by a code of ethics to collect only a flat sum for assignments, regardless of their value conclusion.

What can I expect to see in my appraisal report? (Back to top)

Each appraisal must demonstrate a supported estimate of value and will clearly state the following:

The client and other intended users.
The intended use of the appraisal.
The purpose of the assignment.
The type of value contained and a definition of that value.
The effective date of the appraiser's opinions and conclusions.
Pertinent property attributes, including: location, physical attributes, legal attributes, economic factors, 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 involved 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 appraisal, what assurance is there that the value indicated is trustworthy? (Back to top)

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

That the information analysis utilized in the appraisal was appropriate.

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

That appraisal services were done in a careful and judicious fashion.

That a solid, defensible appraisal report was conferred.

To become a state licensed appraiser, there are extensive education requirements as well as on the jobexperience that must be attained - all with the objective of being able to render unbiased value opinions. Plus, appraisers must abide by a stringent industry code of ethics and comply with national standards of practice for real estate appraisal. The tenets for developing an appraisal and communicating its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Back to top) Licensing and certification takes coursework, tests and practical experience. Once licensed, he or she must then complete continuing education courses so that the license doesn't expire. To see the specific requirements for any state click here.

Who hires NIckey J. Duhon, Real Estate Appraiser (Back to top)

Mortgage lenders are an appraiser's most likely customer, using their services to ensure real estate involved in a mortgage transaction is adequate collateral for a loan. Appraisers also provide opinions for legal settlements, tax matters and investment decisions.

Where does an appraiser get the data used to estimate values in Lafayette County or other areas? (Back to top)

Gathering data is one of the main things an appraiser performs. Data can be categorized as either Specific or General. Specific data is from the home itself; Location, condition, amenities, size and other specifics are documented by the appraiser during an inspection.

General data is collected from a numerous sources. To find out about recent sales to be used as "comps", we typically use the local Multiple Listing Service. To verify actual sales prices, we use items in the assessor's office and other public documents that are usually online nowadays. Appraisers often need to report when a property lies in a flood zone, so that information is retrieved from a FEMA data outlet such as a la mode's InterFlood product.

And last but not least, the appraiser assembles 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? (Back to top)

An appraisal is a worthwhile whenever the value of your home is relevant to a financial decision. For those selling a home, you'll want to determine a 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. When buying, be sure you're not overpaying by commissioning an independent appraisal. For parties settling an estate or divorce, an appraisal from NIckey J. Duhon, Real Estate Appraiser is the best way to ensure assets are split up fairly. Simply put, a home is often the single, largest financial asset anybody owns. Knowing its true value is essential to making informed financial decisions.

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

PMI is short for for Private Mortgage Insurance. It protects the lender in the event a borrower is unable to pay on the loan and the market price of the home is lower than what is owed 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.


	Does your monthly house payment have a lineitem for PMI?Call NIckey J. Duhon, Real Estate Appraiser today at 3372881905 or send us an e-mail. A new appraisal could save you thousands.

Do you need anything from the homeowner in advance? (Back to top)

The first step in most appraisals is the home 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 status of its amenities. On the home's interior, make sure it is clutter free and that we can access things like furnaces and water heaters. In the yard, trim any bushes so we can be free to get an accurate measurement of outside walls.

The following items, if available, will help your appraiser to provide a more accurate appraisal in a shorter period of time:

Any information on the purchase of the property for the last three years.
Any paperwork, 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 date of their installation and their cost (for example, the addition of Insulation or roof repairs) and permit confirmation (if available).
A list of "proposed" improvements if the property is to be appraised "as complete".

What is "Market Value?" (Back 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."

Who has rights to the appraisal report? (Back to top)

For mortgage transactions, the lender orders 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 appraisal - 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 situations, the appraiser may define 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.

Are some home improvements more worthwhile than others? (Back to top)

Like all things real estate, this is dependent on a home's location. For example, adding a central air conditioner in to a home in the South may add significant value, while putting one in a home near the Pacific Northwest might not have much impact.

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 were second, returning 85%. Adding bedrooms and baths can also increase the value of your home as long as your home doesn't then become an oddball for your neighborhood in terms of size.