Augustine, Inc. has answers to "Frequently Asked Questions"

Augustine, Inc. is willing to handle any questions you might have about appraisals or real estate in Cincinnati and Hamilton County. Contact us today to see how we can help you with your specific valuation problems.

What is an appraisal?
What does an appraiser do?
What are the reasons a person would require your services?
How is an appraiser different than a home inspector?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What can I expect to see in my appraisal report?
Once the assignment has been completed, what assurance is there that the value indicated is legitimate?
What are the requirements to be a certified appraiser?
Who employs appraisers?
Where does Augustine, Inc. get the data used to estimate values in Hamilton County or other areas?
Why do I need a professional appraisal?
My mortgage statement has an item on it for PMI? Can I get rid of that?
Do you need anything from me in advance?
What is "Market Value?"
Who actually owns the appraisal report?
How can I get the most ROI out of home improvements?



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

The appraisal process is an evaluation that generates an opinion of value. This opinion or estimate is figured through the use of a formal method that generally utilizes three "common approaches to value". One of the processes in use is the Cost Approach, which finds what it would cost to replace the improvements to the house, minus depreciation and physical dilapidation, plus the land value. Another of the methods is the Sales Comparison Approach - which involves making a comparison to other similar properties within a close proximity which have recently sold. The Sales Comparison Approach is commonly the most definitive and clearest indicator of value for a house. The third approach is the Income Approach, which is the best method in appraising income producing properties - it deals with estimating what an investor would pay based on the income produced by the property.

What does an appraiser do?   (Go to list of  questions)

An appraiser produces an unbiased and well substantiated opinion of market value, to be used in making real estate transactions. Appraisers document their findings in appraisal reports.


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

There are many reasons to purchase an appraisal from Augustine, Inc. with the most common reason being real estate and mortgage transactions. A few other reasons for obtaining an report include:
  • To get a loan.
  • To reduce your tax burden.
  • To build a case for a homeowner's equity and remove PMI.
  • To fight high property taxes.
  • If you need to settle an estate.
  • To provide you a leg-up when purchasing real estate.
  • To determine the most probable price when selling your home.
  • To defend 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 in a lawsuit - an appraisal will help.
If you need more information about the appraisal process, please click here.


How is an appraiser different than a home inspector?   (Go to list of  questions)

Appraisers do not do perform house inspections and are not home inspectors. An inspection is a third-party investigation of the livable structure and mechanical systems of a house, from the roof to the foundation. Commonly, a home inspection report will discuss the amenities and the necessities of the property: air conditioning (weather permitting), electrical systems, the condition of the heating system, the plumbing; then the structural capacity of the home such as the attic, exposed insulation, walls, floors, ceilings, windows, then the foundation, basement and visible structures.

What is the difference between an appraisal and a comparative market analysis (CMA)?   (Go to list of  questions)

To be blunt, it's like comparing broadband and dial-up. The CMA depends on indefinite market trends. An appraisal relies on comparable sales that can be proven by public record. Location and construction values are also important in an appraisal. All a CMA does is generate a "ball park figure." Being a documented and carefully investigated opinion of value, appraisals are defensible and stand up in legal situations.

But the largest differentiator is who's behind the report. Real estate agents, who may not have a complete understanding 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. Moreover, the appraiser is an independent voice, with no conditional interest in the value of a home, unlike the real estate agent, who gets a commission based upon the value of the home.

What can I expect to see in my appraisal report?   (Go to list of  questions)

The main purpose of an appraisal document is to provide a value opinion, and depending on the scope of the report, one will customarily see the following:
  • Who engaged the appraiser and whose purposes the appraisal is to serve.
  • 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 appraiser's opinions and conclusions.
  • Characteristics of the property that have a bearing on the value, including: location, physical characteristics, legal attributes, economic attributes, the property rights valued, and non-real estate items included in the valuation, such as personal property, permanent equipment installations and even intangible items.
  • 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.
  • The scope of work considered to complete the assignment.
For a more in depth view of the work that goes into an appraisal report click here: Sample Appraisal Report


Once the assignment has been completed, what assurance is there that the value indicated is legitimate?   (Go to list of  questions)

In communicating an appraisal report, each appraiser must ensure the following:
  • The appraisal used a suitable analysis of the information.

  • Whether individually or collectively, there were no major errors contained in the report, nor any material details left out.

  • That appraisal services were not rendered in a careless or negligent manner.

  • The final appraisal report was clear, legitimate and defensible.
To become a state licensed appraiser, we must meet considerable education and experience requirements that prepare us to produce an unbiased opinion. In addition, appraisers must follow a stringent industry code of ethics and observe national standards of practice for real estate appraisal. The guidelines for working up an appraisal and documenting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


   (Go to list of  questions) Regulations regarding licensing and certification of Real Estate Appraisers are different from state to state. However, licensing and certification is commonly associated with many hours of classroom study, tests and experience working under a supervisor. Once an appraiser is licensed, he/she must then take continuing education courses so the license remains up to date. To see the specific requirements for any state click here.

Who employs appraisers?   (Go to list of  questions)

Most of the time, appraisers are called upon by lenders to render a value opinion on property involved in a loan transaction - to make sure the property is truly adequate collateral for the loan. Appraisers also provide opinions for legal settlements, tax matters and investment decisions.

Where does Augustine, Inc. get the data used to estimate values in Hamilton County or other areas?   (Go to list of  questions)

Compiling data is one of the primary occupations of an appraiser. Data can be split into Specific or General. Specific data is from the home itself; Location, condition, amenities, size and other specific data are noted by the appraiser during an inspection.

General data is received from a number of sources. To find out about recently sold homes to be used as "comps", we often use the local Multiple Listing Service. To verify actual sales prices, we research 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 service.

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


Why do I need a professional appraisal?   (Go to list of  questions)

An appraisal is a worthwhile whenever your home's value is relevant to a financial decision. If you're selling your home, an appraisal helps you set the most appropriate price. If you're buying, it makes sure you don't overpay. For those settling an estate or divorce, an appraisal from Augustine, Inc. is the best documentation to ensure assets are divided evenly. A house is often the single, largest financial asset anybody owns. Knowing its true value is essential to making wise financial decisions.


My mortgage statement has an item on it for PMI? Can I get rid of that?   (Go to list of  questions)

PMI is the common abbreviation for for Private Mortgage Insurance. PMI protects the lender in the event a borrower is unable to pay on the loan and the value of the property is lower than what the borrower still owes 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.

Has your home value appreciated since you first purchased? Call Augustine, Inc. today at 5134816800. You may be able to cancel your Private Mortgage Insurance payment.

Do you need anything from me in advance?   (Go to list of  questions)

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. On the home's interior, pick up any clutter and make sure we can access 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.

To help expedite our work as well as ensure a more accurate report, try if possible to have the following items:
  • A survey or plot map of the property and building (if available).
  • Any documents, such as a title policy with information on encroachments or easements encroachments or easements.
  • Home inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, septic systems and wells.
  • A copy of the current listing agreement and broker's data sheet and Purchase Agreement if a sale is "pending".
  • A list of "proposed" improvements when the property is being appraised "as complete".

What is "Market Value?"   (Go to list of  questions)

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 actually owns the appraisal report?   (Go to list of  questions)

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 allowed 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 define how the appraisal can be used; for PMI removal, or estate planning or tax challenges, for example. If not stated otherwise, the home owner can do whatever they want with the appraisal.


How can I get the most ROI out of home improvements?   (Go to list of  questions)

Like all things real estate, this is dependent on a home's location. For example, installing an inline humidifier could be nice in arid regions, but completely useless near the coast!

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