The typical appraisal process consists of an on-site inspection to document property characteristics and a subsequent report analyzing comparable sales to provide an opinion of value. The real estate appraiser will typically utilize the Sales Comparison Approach along with a Cost Approach and/or Income Approach when applicable to determine a current market value. These conclusions are reported in the appraisal report document.

An appraiser is an unbiased party to the real estate transaction who provides research and analysis to produce a credible opinion of market value.

Appraisers are typically employed by lenders for mortgage transactions through the use of Appraisal Management Companies. Appraisers can also be employed directly by banks for in house lending and real estate agents, homeowners and attorneys for non-lending transactions or to determine the current market value of an estate.

Gathering data and analysis is one of the primary roles of an appraiser. Specific data is gathered from the home itself via on-site inspection and interviews with the homeowner and other parties involved in the transaction. Details on location, condition, quality and amenities, home size, functional utility, and other relative data are gathered by the appraiser during the on-site inspection. Additional resources to include public record, aerial photography, multiple listing services, real estate agents, private data sources, tax documents, and zoning resources are but a sample of the many resources utilized to compile and research property specifics. A detailed search of the subject neighborhood and review of market trends are required to determine the most comparable sales to a specific property.

An appraisal will be required by a lender or bank to determine the collateral value of your home. The appraisal assists the lender in determining the asset value of the home for purposes on lending in a financial transaction. Alternatively, homeowners may utilize a professional appraisal report to determine the market value of a complex property relative to a listing transaction or estate dispute. Attorneys and CPA’s utilize the appraiser to determine home valuation relative to legal and other professional uses. The selection of a qualified appraiser, with knowledge of current market trends and experienced in the valuation of your unique property type is essential to this process.

PMI stands for Private Mortgage Insurance. It insures a lender against loss on homes purchased with a down-payment of less than 20%. Once equity in the home reaches 20% you can eliminate the PMI and start saving immediately.