Tenaglia Appraisals, Inc. has answers to "Frequently Asked Questions"


	Tenaglia Appraisals, Inc. is ready to reply to any concerns you might have about appraisals or real estate in Hudson and Middlesex County. Contact Michael Tenaglia 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 require your services?
Is an appraisal the same as a home inspection?
Is an appraisal the same as a comparative market analysis(CMA)?
What does the appraisal report contain?
Once the report is done, what guarantee is there that the final number is legitimate?
What goes into an appraiser's certification?
Who hires Michael Tenaglia
Where does an appraiser get the information used to estimate values in Middlesex County or other areas?
What can a full appraisal do for me?
My mortgage statement has an item on it for PMI? Can I get rid of that?
Do you need anything from the homeowner in advance?
What is "Market Value?"
Who has rights to the appraisal report?
How can I get the most ROI out of home improvements?

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

The procedure of producing an appraisal deals with an estimation which forms 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 how much capital would be required to replace the improvements, less physical deterioration and other factors, plus the land value. The most common approach in figuring the likely sales price of a house is the Sales Comparison Approach which involves figuring a comparison to comparable houses close by. Being the most popular approach, the Sales Comparison Approach is generally the most precise and best indicator of market value for a home. One of the least common approaches in appraising residential properties is the Income Approach, which is generally used to find the market value of a property based on what an investor would pay based on the income produced by the building.

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

An appraiser produces an impartial and well justified assessment of market value, in the support of real estate transactions. Appraisers summarize their expert findings in appraisal reports.

Why would a person require your services? (See list of FAQ's)

There are a lot of reasons to order an appraisal from Michael Tenaglia with the most common reason being real estate and mortgage transactions. A few other reasons for getting an appraisal include:

To receive a loan.
If you would like to lower your property tax burden.
To help a homeowner realize if they owe less than 80% of their home's value and remove PMI.
To contest high property taxes.
If you need to settle an estate.
To give you a negotiating tool when purchasing a home.
To find a likely sales price when listing your home.
To ensure parties are provided just compensation in eminient domain cases.
Government agencies such as the IRS require an appraisal on every home.
It's possible you could be involved in a lawsuit - an appraisal will help.

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

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

Home inspectors do not figure out an opinion of value and are not appraisers. An inspection is a third-party evaluation of the available structure and mechanical systems of a house, from the top to the foundation. The usual home inspector's report will contain an evaluation of the condition of the house's heating system, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and accessible 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 blunt, it's apples and oranges. What the CMA depends on are ill-defined trends. Appraisals use similar sales which are verifiable resources. The appraisal report will also contain location and building costs. A CMA delivers a "ball park figure." Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.

But the largest differentiator is who's doing the report. Real estate agents produce CMA's, and they don't always know the whole market or have specific competence when it comes to home valuation. A certified, state licensed professional who made a career on valuing real estate in and around Middlesex County is behind the appraisal. Likewise, the agent has a vested interest in the property's selling price whereas the appraiser is bound by a code of ethics to collect only a flat sum for assignments, regardless of their outcome.

What does the appraisal report contain? (See list of FAQ's)

The main point of an appraisal document is to provide a value opinion, and depending on the scope of the report, one will customarily see the following:

The client and other intended users.
How the appraisal is supposed to be used.
The appraisal's purpose.
The type of value contained and a definition of that value.
The effective date of the appraisal.
Pertinent property attributes, 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, trade fixtures and even intangible items.
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 job.

For a more comprehensive look at the work that goes into an appraisal report click here: Sample Appraisal Report

Once the report is done, what guarantee is there that the final number is legitimate? (See list of FAQ's)

In communicating an appraisal report, each appraiser must ensure the following:

The appraisal used an apropos analysis of the information.
Whether individually or collectively, there were no significant errors contained in the appraisal, nor any material 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 satisfy intense education and experience requirements that prepare us to produce an unbiased opinion. In addition, appraisers must abide by a meticulous 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 vary from state to state. However, licensing and certification typically translates to many hours of classroom study, tests and experience working under a supervisory appraiser. Once licensed, he/she is required to engage in continuing education courses in order to keep the license current. To see the specific requirements for any state click here.

Who hires Michael Tenaglia (See list of FAQ's)

Most of the time, appraisers are called upon by lenders to render a value opinion on real estate involved in a loan transaction. Attorneys and CPAs also retain the services of appraisers for divorce and estate settlements.

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

Compiling data is one of the main things an appraiser engages in. Data can be categorized as either Specific or General. Specific data is gathered from the property itself; Location, condition, amenities, size and other specific data are noted by the appraiser while on site.

General data is gathered from a numerous sources. To find out about recently sold homes to be used as "comps", an appraiser will typically go to the local Multiple Listing Service. To verify actual sales prices, we research items in the assessor's office and other public documents. Appraisers routinely need 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 service.

And last but not least, the appraiser assimilates general data from his or her collective knowledge gained from doing assignments for other properties in the same market.

What can a full appraisal do for me? (See list of FAQ's)

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 assists you in setting the most appropriate price. When buying, you can avoid overpaying by commissioning an independent appraisal. If you're engaged in an estate settlement or divorce, it ensures that property is divided fairly. A home 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 stands for Private Mortgage Insurance. It takes care of the lender if a borrower defaults on the loan and the market price of the home 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.


	The money you keep from dropping the PMI required when you got your mortgage will make up for the price of the appraisal in a matter of months. Nobody is more qualified than Michael Tenaglia when it comes to analyzing real estate appreciation in Hudson and Middlesex County. Contact us today.

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

The first step in most appraisals is the property inspection. 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 status of its amenities. 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 shrubs and relocate any items that would make it difficult to measure the structure. Indoors, make sure we can get to items 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:

A survey or plot map of the property and building (if readily available).
List of personal property to be sold with the home.
Home inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, your septic system and wells.
A list of any major home improvements and upgrades, the date of their installation and their cost (for example, the addition of Energy efficiency upgrades or roof repairs) and permit confirmation (if available).
A list of "suggested" improvements if the property is to be appraised "as complete".

What is "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."

Who has rights to the appraisal report? (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 certainly entitled to a copy of the appraisal - 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 engages an appraiser directly. In these cases, the appraiser may stipulate 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? (See list of FAQ's)

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. 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 were second, 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 overbuilt for your neighborhood in terms of size.