George Kemp (410) 474-0260 has answers to "Frequently Asked Questions"


	George Kemp (410) 474-0260 is prepared to elaborate on any concerns you might have about appraisals in Calvert County. Feel free to contact us today.

Define the term "Appraisal"
What does an appraiser do?
What would cause me to need services from George Kemp (410) 474-0260?
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?
Upon completion of the report, how can I have a guarantee that the final number is veritable?
What goes into an appraiser's certification?
Who are an appraiser's customers?
Where does an appraiser get the data used to estimate values in Calvert 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?
Does the appraiser need anything from me in advance?
What does "Market Value" mean?
Does the appraisal belong to the bank or the consumer?
Which home renovations add the most to the price?

Define the term "Appraisal" (Back to top)

The procedure of producing an appraisal deals with an investigation which forms an opinion of value. This opinion or estimate is found through the use of a formal process that typically utilizes three "common approaches to value". One of the processes in use is the Cost Approach, which is what it would cost to restore the improvements to the home, less the depreciation and physical deterioration, adding the land value. The most common approach in figuring the value of a home is the Sales Comparison Approach which involves making a comparison to similar homes close by. The Sales Comparison Approach is normally the most definitive and clearest indicator of a liklely sales price for a home. The Income Approach is mainly used for finding the market value of income-producing properties based on what an investor would pay based on the amount of capital a property produce.

What does an appraiser do? (Back to top)

An appraiser offers a fair and credible opinion of market value, often in the context of a real estate purchase. Appraisers exhibit their expert investigation in appraisal reports.

What would cause me to need services from George Kemp (410) 474-0260? (Back to top)

There are many reasons to purchase an appraisal with the most common reason being real estate and mortgage transactions. A few other reasons for ordering an report include:

To obtain 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 Primary Mortgage Insurance.
To contest improperly assessed property taxes.
To handle an estate.
To offer you a leg-up when purchasing real estate.
To determine a likely price when selling your home.
To protect 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 property.
If you ever find yourself in a lawsuit.

Click here for a more extensive explanation of the process involved in getting an appraisal.

How is an appraisal different than a home inspection? (Back to top)

Appraisers do not do provide home inspections and are not home inspectors. An inspection is a third-party evaluation of the available structure and appliances of a house, from the top to the foundation. The standard house 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)? (Back to top)

Simply put, it's night and day. What the CMA relies upon are superficial trends. An appraisal is based on comparable sales that can be verified by public record. In addition, the appraisal looks at other factors like condition, neighborhood and replacement prices. The CMA will provide a non-specific figure. Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.

The credentials of the person behind the report is hands down 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, Maryland licensed professional who made a career on valuing real estate in and around Calvert County creates the appraisal. Moreover, the appraiser is an unbiased voice, with no conditional interest in the value conclusion, unlike the agent, who gets a commission based upon the price of the home.

What are the contents of an appraisal report? (Back to top)

Every appraisal must indicate a believable value opinion and must identify the following:

The client and other intended users.
How the appraisal is supposed to be used.
The reason for the assignment.
The type of value reported and a definition of that value.
The effective date of the value opinion.(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 characteristics, legal attributes, economic factors, the property rights 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 other items of a similar nature.
Division of interest, such as fractional interest, physical segment and partial holding.
The scope of work used to complete the appraisal.

For a more comprehensive view of what goes into an appraisal report click here: Sample Appraisal Report

Upon completion of the report, how can I have a guarantee that the final number is veritable? (Back to top)

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

The appraisal used an apropos analysis of the data.

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

That appraisal services were not conducted in a careless or negligent fashion.

The final appraisal report was easy to explain, credible and conclusive.

To become a state licensed appraiser, we must fulfill intense education and experience requirements that give us the background to formulate an unbiased opinion. Plus, appraisers must obey a stringent industry code of ethics and observe national standards of practice for real estate appraisal. The tenets for developing an appraisal and documenting its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Back to top) Regulations regarding licensing and certification vary from state to state. However, licensing and certification typically translates to many hours of classroom study, tests and practical experience. Once an appraiser is 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 are an appraiser's customers? (Back to top)

Mortgage lenders are an appraiser's most likely customer, requesting 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 Calvert County or other areas? (Back to top)

Gathering data is one of the primary tasks an appraiser engages in. Data can be divided into Specific or General. Specific data is collected from the property itself; Location, condition, amenities, size and other specifics are gathered by the appraiser while on site.

General data is gathered from a many sources. To research recent sales to be used as "comps", an appraiser will often use the local Multiple Listing Service. Tax records and other public documents verify actual sales prices in a market. Appraisers often have to report when a property is in a flood zone, and that information is retrieved from a FEMA data outlet such as a la mode's InterFlood product.

And most importantly, the appraiser gathers general data from his or her collective knowledge gained from doing assignments for other properties in the same market.

Why do I need a professional appraisal? (Back to top)

Any time the value of your home or other real property is being used to make a significant financial decision, an appraisal helps. When selling your house, an appraisal helps you set a price that maximizes profit and reduces time on the market. When buying, be sure you're not overpaying by commissioning an independent appraisal. For those settling an estate or divorce, an appraisal from George Kemp (410) 474-0260 is the best way to ensure assets are divided properly. Simply put, a home is often the single, largest financial asset anybody owns. Knowing its true value means you can make informed financial decisions.

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

PMI is short for for Private Mortgage Insurance. It protects the lender in the event a borrower defaults on the loan and the market price of the house is lower than the loan balance. Once you reach the point where your home's equity plus the amount you've paid is at least 20% of your loan balance, you can have your PMI dropped.


	Does your monthly mortgage payment include a fee for PMI?Call George Kemp (410) 474-0260 today at 410-474-0260 or send us an e-mail. A new appraisal could save you thousands.

Does the appraiser need anything from me in advance? (Back to top)

The first step in most appraisals is the property inspection. 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. The best thing you can do to help is make sure we have easy access to the exterior of the house (gates aren't locked, etc). Trim any shrubs and move any items that would make it difficult to measure the structure. On the inside, 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:

Information on any written private agreements, such as a shared driveway with a neighbor.
A list of any personal property that is part of the home and you intend to be sold with the home, such as an oven, or a washer and dryer, if applicable.
Any inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, septic systems and wells.
Locate copies of the current listing agreement, broker's data sheet and, if the sale is "pending", the purchase agreement.
A list of "suggested" improvements if the property is to be appraised "as complete".

What does "Market Value" mean? (Back to top)

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? (Back to top)

For mortgage transactions, the lender orders 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 report - it's usually included with all the other closing documents - but is not entitled to use the report for any other purpose without permission from the lender.

The exception to this rule is when a home owner hires an appraiser directly. In these cases, the appraiser may state 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.

Which home renovations add the most to the price? (Back to top)

The added value of a particular amenity truly depends on the local market. For example, if you're in a neigborhood of small to medium priced homes, a media room may not be something people in that price range want

As a rule, the most value returned 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 are right up there with kitchens, yielding 85%. Adding bedrooms and baths can also increase 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.