CFB Appraisal has answers to "Frequently Asked Questions"

CFB Appraisal is always willing to talk to you about any concerns you might have about appraisals in Bexar County. Contact CFB Appraisal today to talk about how we can help solve your specific valuation problems.

Define the term "Appraisal"
Describe what an appraiser does
Why would a person request services from CFB Appraisal?
How is an appraisal different than a home inspection?
Is an appraisal the same as a comparative market analysis(CMA)?
What are the contents of an appraisal report?
Once the report is done, how can I have certainty that the final number is veritable?
How are appraisers certified?
Who engages the services of appraisers?
Where does CFB Appraisal get the information used to estimate values in Bexar County or other areas?
Why should I hire a licensed appraiser?
My mortgage statement has an item on it for PMI? Can I get rid of that?
Does the appraiser need anything from the homeowner in advance?
What is "Market Value?"
Does the appraisal belong to the bank or the consumer?
Are some home improvements more worthwhile than others?



Define the term "Appraisal"   (See list of FAQ's)

The appraisal process is an estimation that generates an opinion of value. There are three "common approaches to value" which assists the appraiser arrive at this opinion or valuation. One of the processes in use is the Cost Approach, which finds what it would cost to restore the improvements to the house, minus age and physical dilapidation, adding the land value. The Sales Comparison Approach involves finding comparable properties in the vicinity and discovering the value based on making a comparison of those prior sales to the house being appraised. Generally speaking, the Sales Comparison Approach is the most accurate indicator of market value of a home. The Income Approach is primarily used for figuring out the market value of income-producing properties based on what an investor would pay based on the amount of income a property produce.

Describe what an appraiser does   (See list of FAQ's)

An appraiser generates a fair and credible assessment of market value, in the support of real estate exchanges. Appraisers exhibit their expert findings in appraisal reports.


Why would a person request services from CFB Appraisal?   (See list of FAQ's)

There are many reasons to order an appraisal from CFB Appraisal with the usual reason being real estate and mortgage transactions. Some other reasons for obtaining an report 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 fight high property taxes.
  • If you need to take care of an estate.
  • To give you an edge when purchasing real estate.
  • To determine a likely price when selling your home.
  • To ensure parties are provided just compensation in eminient domain cases.
  • Because an official agency such as the IRS requires it.
  • If you are ever involved in a civil case.
Click here for a more detailed explanation of the process about getting an appraisal.


How is an appraisal different than a home inspection?   (See list of FAQ's)

Home inspectors do not come to an opinion of value and are not appraisers. The point of a home inspection is to evaluate the structure of the home from basement to rooftop. The standard home inspector's report will contain an evaluation of the condition of the house's heating systems, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and visible insulation, walls, ceilings, floors, windows and doors, the foundation, basement, and visible structure.

Is an appraisal the same as a comparative market analysis(CMA)?   (See list of FAQ's)

To be honest, they share nothing in common. The CMA relies on vague trends in the market. An appraisal is based on comparable sales that can be verified by records. The appraisal report will also contain area and construction values. All a CMA does is generate a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

But the biggest difference is the person behind 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. The appraisal is created by a licensed, certified professional who has made a career out of valuing properties. Moreover, the appraiser is an unbiased voice, with no conditional interest in the property's value, unlike the agent, who gets a commission based upon the value of the home.

What are the contents of an appraisal report?   (See list of FAQ's)

The main objective of an appraisal report is to give a value opinion, and depending on the scope of the report, you'll usually see the following:
  • Who engaged the appraiser and whose purposes the appraisal is to serve.
  • How the appraisal is supposed to be used.
  • The purpose of the appraisal.
  • The type of value contained and a definition of the value reported.
  • The effective date of the appraiser's opinions and conclusions.(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 attributes, legal attributes, economic factors, the real property interest in question, and non-real estate items included in the appraisal, such as personal property, items that are more or less permanently installed and even intangible factors.
  • All 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 appraisal.
For a more comprehensive view of what goes into an appraisal report click here: Sample Appraisal Report

Once the report is done, how can I have certainty that the final number is veritable?   (See list of FAQ's)

In the documentation of an appraisal, each appraiser must see to it that each of the items below are covered:
  • That the information analysis utilized in the appraisal was suitable.

  • Whether individually or collectively, there were no grave errors contained in the appraisal, nor any relevant details left out.

  • That appraisal services were rendered in a careful and judicious manner.

  • That a trustworthy, defensible appraisal report was conferred.
To become a state licensed appraiser, there are intense education requirements as well as on the jobexperience that must be logged. Plus, appraisers must obey a strict industry code of ethics and respect national standards of practice for real estate appraisal. The rules for working up an appraisal and reporting its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


    (See list of FAQ's) Licensing and certification requires coursework, tests and experience working under a supervisory appraiser. Once licensed, he or she is required to complete continuing education courses so that the license doesn't expire. To see the specific requirements for any state click here.

Who engages the services of appraisers?   (See list of FAQ's)

Typically, appraisers are employed by lenders to render a value opinion on property involved in a loan transaction - to make sure the property is indeed adequate collateral for the loan. Attorneys and CPAs also hire appraisers for asset division and estate settlements.

Where does CFB Appraisal get the information used to estimate values in Bexar County or other areas?   (See list of FAQ's)

Collecting data is one of the primary things an appraiser performs. Data can be described as either Specific or General. Specific data is taken from the home itself; Location, condition, amenities, size and other specifics are noted by the appraiser during an inspection.

General data is received from a variety of places. Local Multiple Listing Services (MLS) have data on recently sold homes that might be used as comparables. To double-check actual sales prices, we research items in the assessor's office and other public documents. Flood zone data is gathered from FEMA data outlets, such as a la mode's InterFlood service.

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

Why should I hire a licensed appraiser?   (See list of FAQ's)

An appraisal is a worthwhile whenever your home's value is relevant to a financial decision. When selling your home, an appraisal will help you determine the most appropriate price. If you're buying, it makes sure you don't overpay. For parties settling an estate or divorce, an appraisal from CFB Appraisal is the best way to ensure assets are split up properly. Simply put, a house is often the single, largest financial asset anybody owns. Without knowing its real value, wise financial decisions are impossible.

My mortgage statement has an item on it for PMI? Can I get rid of that?   (See list of FAQ's)

PMI is short for for Private Mortgage Insurance. It takes care of the lender in the event a borrower doesn't pay on the loan and the market price of the house is lower than what the borrower still owes on the loan. You can have your PMI dropped once you've achieved 20% equity in your home through appreciation and principal payments.

Is PMI something increasing your monthly house payment?Call CFB Appraisal today at 210-481-0523 or send us an e-mail. Documentation of your home's present value could save you thousands.

Does the appraiser need anything from the homeowner in advance?   (See list of FAQ's)

We begin with an inspection of the property. During this process, we 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. Is there anything you can do to help? Yes there is! First, be sure the appraiser has easy access to the exterior of the house (gates aren't locked, etc). Trim any landscaping and move any items that would make it difficult to measure the structure. Indoors, make sure we can get to appliances 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:
  • Any information on the purchase of the property for the last three years.
  • Information on any written private easements, such as a shared driveway with a neighbor.
  • A bill for your most recent real estate taxes which should also contain a 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.

What is "Market Value?"   (See list of FAQ's)

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."

Does the appraisal belong to the bank or the consumer?   (See list of FAQ's)

For mortgage transactions, the lender requests the appraisal, either directly or through a third party. 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 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.

This rule doesn't apply when a home owner hires an appraiser directly. 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 noted otherwise, the home owner can do whatever they want with the appraisal.

Are some home improvements more worthwhile than others?   (See list of FAQ's)

It really depends on the market. For example, if you live in a cold region, insulated windows can be a real plus. But they aren't as attractive in a warm-weather climate.

No matter where you go, however, renovating a kitchen is almost always a safe move. 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, yielding 85%. Adding bedrooms and baths can also boost the value of your home (when done well) as long as your home doesn't then become atypical for your neighborhood in terms of size.