Miles Appraisal Group has answers to "Frequently Asked Questions"

Miles Appraisal Group is happy to reply to any concerns you might have about appraisals or real estate in Saint Tammany County. Feel free to contact us today.

Describe an appraisal
Describe what an appraiser does
What are the reasons a person would need services from Miles Appraisal Group?
Is an appraisal the same as a home inspection?
Is an appraisal the same as a comparative market analysis(CMA)?
What's in an appraisal report?
Once the assignment has been completed, what guarantee is there that the final number is valid?
What goes into an appraiser's certification?
Who are an appraiser's customers?
Where does an appraiser get the information used to estimate values in Saint Tammany 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?
Define "Market Value"
Does the appraisal belong to the bank or the consumer?
Are some home improvements more worthwhile than others?



Describe an appraisal   (See list of FAQ's)

An appraisal is an estimation that concludes with an opinion of value. There are three "common approaches to value" which helps the appraiser come to this opinion or valuation. One of them is the Cost Approach - which is what it would cost to replace the improvements, less physical deterioration and other factors, plus the land value. The Sales Comparison Approach involves finding comparable homes nearby and discerning value based on comparing those homes to the property being investigated. Being the most popular approach, the Sales Comparison Approach is generally the most precise and best indicator of market value for a house. The third approach is the Income Approach, which is the most important method in appraising income producing properties - it involves estimating what an investor would pay based on the money generated by the property.

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

An appraiser generates an unbiased and well substantiated opinion of market value, to be used in making real estate transactions. Appraisers exhibit their professional conclusions in appraisal reports.


What are the reasons a person would need services from Miles Appraisal Group?   (See list of FAQ's)

There are a lot of reasons to obtain an appraisal from Miles Appraisal Group with the usual reason being real estate and mortgage transactions. A few other reasons for obtaining an appraisal include:
  • To obtain a loan.
  • To lower your property taxes.
  • To demonstrate a homeowner's acquired equity and remove insurance.
  • To challenge high property taxes.
  • To handle an estate.
  • To provide you a leg-up when purchasing real estate.
  • To find a reasonable price when listing 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.
  • If you are ever involved in a lawsuit.
For a more extensive explanation of the appraisal process click here.


Is an appraisal the same as a home inspection?   (See list of FAQ's)

The appraiser is not a home inspector nor does he/she do a complete home inspection. A third-party home inspector will investigate the structure of the house, from the roof to the foundation. Usually, a home inspection report will evaluate the amenities and the requirements of the home: air conditioning (weather permitting), electrical services, the condition of the heating system, the plumbing; then the structural integrity of the home such as the attic, exposed insulation, walls, floors, ceilings, windows, then the foundation, basement and other visible structures.

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

Simply put, it's like comparing sugar and saccharin. The CMA depends on vague local market trends. The appraisal depends on specific definite comparable sales. In addition, the appraisal verifies other factors like condition, location and replacement prices. 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.

Who's creating the report is frankly the biggest difference between a CMA and an appraisal. 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. A certified, Louisiana licensed professional who bases their livelihood on valuing homes in and around Saint Tammany County creates the appraisal. Likewise, the agent has something at stake since they get a commission based on the property's selling price whereas the appraiser is bound by a code of ethics to accept a previously agreed upon sum for work they perform, regardless of their value conclusion.

What's in an appraisal report?   (See list of FAQ's)

Each report should reflect a supported value opinion and must document the following:
  • The client and whose purposes the appraisal is to serve.
  • The intended use of the report.
  • The appraisal's purpose.
  • The type of value contained and a definition of that value.
  • The effective date of the appraisal.(Sometimes this is in the past or maybe the future for new construction!)
  • Pertinent property attributes, including: location, physical description, legal attributes, economic attributes, the real property interest valued, and non-real estate items included in the appraisal, such as personal property, permanent equipment installations and even intangible considerations.
  • 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 appraisal.
For a more detailed view of all that goes into an appraisal report click here: Sample Appraisal Report


Once the assignment has been completed, what guarantee is there that the final number is valid?   (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 contained in the appraisal was proper.

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

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

  • The final appraisal report was understandable, sound and conclusive.
To become a state licensed appraiser, there are strenuous education requirements as well as practical experience that must be attained. In addition, appraisers must obey a strict industry code of ethics and respect national standards of practice for real estate appraisal. The tenets for carrying out an appraisal and communicating its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


   (See list of FAQ's) Regulations regarding licensing and certification of Real Estate Appraisers are different from state to state. In general, licensing and certification typically translates to many hours of coursework, tests and real world experience. Once an appraiser is 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 are an appraiser's customers?   (See list of FAQ's)

Commonly, appraisers are called upon by lenders to estimate the value of a house involved in a loan transaction. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

Where does an appraiser get the information used to estimate values in Saint Tammany County or other areas?   (See list of FAQ's)

One of the most important things an appraiser does is to assimilate data. Data can be classified as either Specific or General. Specific data is collected from the property itself; Location, condition, amenities, size and other specifics are documented by the appraiser during an inspection.

General data is received from a many places. Local Multiple Listing Services (MLS) provide data on recently sold homes that might be used as comparables. Tax records and other public documents reveal actual sales prices in a market. Appraisers often need to report when a property lies in a flood zone, and that information is retrieved from a FEMA data outlet such as a la mode's InterFlood product.

And last but not least, 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 valuable tool whenever your home's value is relevant to a financial decision. When selling your home, an appraisal assists you in setting the most appropriate price. When buying, be sure you're not overpaying by commissioning an independent appraisal. If you're engaged in an estate settlement or divorce, it ensures that property is divided fairly. A house 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?   (See list of FAQ's)

PMI is the common abbreviation for for Private Mortgage Insurance. This additional plan covers the lender in case a borrower defaults on the loan and the market price of the house is less than the loan balance. 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.

Is PMI a lineitem in your monthly house payment?Call Miles Appraisal Group today at 985-871-5161 or send us an e-mail. Documentation of your home's present value could save you thousands.

How do I get ready for the appraiser?   (See list of FAQ's)

We begin with an inspection of the property. 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 condition of its features. Inside, pick up any clutter and make sure we can access things like furnaces and water heaters. On the outside, trim any landscaping so we can be free to get an accurate measurement of exterior walls.

You can make the inspection go faster and improve the accuracy of the appraisal report by having the following things on hand:
  • Information on the latest purchase of the property in the last three years.
  • Information on any written private easements, such as a shared driveway with a neighbor.
  • Any documents, such as a title policy with information on encroachments or easements encroachments or easements.
  • 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 "suggested" improvements if the property is to be appraised "as complete".

Define "Market Value"   (See list of FAQ's)

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."



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

In most real estate transactions, the appraisal is ordered by the lender. 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 report - 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 hires an appraiser directly. In these cases, the appraiser may define 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.


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

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!

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, returning 85%. On the contrary, an improvement that may not increase your value would be painting just for the sake of redecorating.