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

CFour Appraisals, Inc. is always eager to elaborate on any inquiries you might have about appraisals in Fort Bend County. Don't hesitate to contact us today.

What is an appraisal?
What does an appraiser do?
What would cause me to need your services?
How is an appraisal different than a home inspection?
What is the difference between an appraisal and a comparative market analysis (CMA)?
What does the appraisal report contain?
After completing the report, how can I have assurance that the final number is accurate?
How difficult is it to become certified?
Who do appraisers work for?
Where does CFour Appraisals, Inc. get the information used to estimate values in Fort Bend 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?
Should I do anything in advance of the appraisal appointment
Define "Market Value"
Does the appraisal belong to the bank or the consumer?
Which home renovations add the most to the price?



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

The process of performing an appraisal report consists of an evaluation which leads to an opinion of value. This opinion or estimate is found through the use of a formal process that commonly utilizes the three main "common approaches to value". The Cost Approach is one of the approaches that appraisers use to find the value of a home; it involves finding what the improvements would cost without physical depreciation, adding the land value. The Sales Comparison Approach involves searching for comparable houses nearby and discerning value based on making a comparison of those homes to the home being investigated. Being the most common approach, the Sales Comparison Approach is generally the most precise and best indicator of market value for a house. One of the least common approaches in appraising homes is the Income Approach, which is commonly used to figure the market value of a property based on what an investor would pay based on the income produced by the property.

What does an appraiser do?   (See list of FAQ's)

An appraiser offers a professional, unbiased determination of market value, in the support of real estate transactions. Appraisers illustate their analysis in appraisal reports.


What would cause me to need your services?   (See list of FAQ's)

There are many reasons to order an appraisal from CFour Appraisals, Inc. with the usual reason being real estate and mortgage transactions. Some other reasons for getting an report include:
  • If you are applying for a loan.
  • To lower your tax burden.
  • To show a homeowner has 30% equity and remove insurance.
  • To challenge improperly assessed property taxes.
  • To settle an estate.
  • To offer you a leg-up when purchasing a home.
  • To find a likely sales price when selling real estate.
  • To protect 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 be involved in a lawsuit - an appraisal will help.
For a more detailed explanation of the appraisal process click here.


How is an appraisal different than a home inspection?   (See list of FAQ's)

Appraisers do not do complete house inspections and are not home inspectors. A third-party home inspector will investigate the structure of the home, from the roof to the bottom. For the most part, a home inspection report will evaluate the amenities and the requirements of the home: air conditioning (weather permitting), electrical systems, the condition of the heating system, the plumbing; then the structural integrity of the home such as the attic, visible insulation, walls, floors, ceilings, windows, then the foundation, basement and other visible structures.

What is the difference between an appraisal and a comparative market analysis (CMA)?   (See list of FAQ's)

Simply put, it's like comparing Shakespeare to reality TV. The CMA depends on vague local market trends. An appraisal is based on comparable sales that can be proven by public record. In addition, the appraisal checks other factors like condition, neighborhood and replacement costs. All a CMA does is generate a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

Who's creating the report is actually the most significant difference between a CMA and an appraisal. Real estate agents produce CMA's, and they don't always know the whole market or bear specific competence when it comes to home valuation. A certified, Texas licensed professional who bases their livelihood on valuing homes in and around Fort Bend County is behind the appraisal. Moreover, the appraiser is an unbiased party, with no conditional interest in the property's value, unlike the real estate agent, whose income is tied to the price of the home.

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

Every appraisal must demonstrate a supported estimate of value and will clearly state the following:
  • Who engaged the appraiser and other intended users.
  • The intended use of the appraisal.
  • The appraisal's purpose.
  • The type of value contained and a definition of the value reported.
  • The effective date of the appraiser's opinions and conclusions.
  • Relevant property characteristics, including: location, physical characteristics, legal attributes, economic factors, the property rights in question, and non-real estate items included in the valuation, such as personal property, trade fixtures 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.
  • What was entailed in the process of completing the assignment.
For a more in depth look at what goes into an appraisal report click here: Sample Appraisal Report


After completing the report, how can I have assurance that the final number is accurate?   (See list of FAQ's)

In communicating an appraisal report, each appraiser must ensure the following:
  • The appraisal contained an apropos analysis of the information.

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

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

  • That a credible, supportable appraisal report was communicated.
To become a state licensed appraiser, we must fulfill considerable education and experience requirements that give us the background to produce an unbiased opinion. Plus, appraisers must stick to a meticulous industry code of ethics and comply with national standards of practice for real estate appraisal. The rules for developing an appraisal and reporting 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 are different from state to state. In general, licensing and certification typically translates to many hours of classroom study, tests and practical experience. 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 do appraisers work for?   (See list of FAQ's)

Most of the time, appraisers are hired by mortgage lenders to estimate the value of a home involved in a loan transaction. Appraisers also provide opinions for legal settlements, tax matters and investment decisions.

Where does CFour Appraisals, Inc. get the information used to estimate values in Fort Bend County or other areas?   (See list of FAQ's)

Compiling information is one of the primary occupations of an appraiser. Data can be classified as either Specific or General. Specific data is collected from the property itself; Location, condition, amenities, size and other specific data are documented by the appraiser while on site.

General data is collected from a many sources. To look up 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 routinely need to report when a property is 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 assembles general data from his or her past experience in creating appraisals for other properties in the same market.


Why do I need a professional appraisal?   (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. 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 parties settling an estate or divorce, an appraisal from CFour Appraisals, Inc. is the best way to ensure assets are divided evenly. Simply put, 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 is an acronym for Private Mortgage Insurance. This supplemental plan takes care of the lender if a borrower doesn't pay 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.

Did you secure your mortgage with less than 20% down? Contact CFour Appraisals, Inc. today at 979-292-5727. You may be able to cancel your Private Mortgage Insurance premium.

Should I do anything in advance of the appraisal appointment   (See list of FAQ's)

We begin with an inspection of the home. 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. Inside, make sure it is clutter free and that we can get to things like furnaces and water heaters. In the yard, trim any bushes so we can be free to get an accurate measurement of exterior walls.

To help speed things along plus ensure a more accurate report, attempt if possible to have the following items:
  • Any information on the purchase of the property for the last three years.
  • List of personal property to be sold with the building.
  • Title policy that lists 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".

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

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?   (See list of FAQ's)

In most real estate transactions, the appraisal is ordered by the lender. 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 certainly entitled to a copy of the report - it's usually bundled 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 engages an appraiser directly. In these cases, the appraiser may stipulate the purpose of the appraisal; for PMI removal, or estate planning or tax challenges, for example. If not noted otherwise, the home owner can use the appraisal for any purpose.


Which home renovations add the most to the price?   (See list of FAQ's)

The added value of a particular amenity truly depends on the local market. For example, if you live in a cold region, insulated windows can be a real plus. But they aren't as attractive in a warm-weather climate.

No matter where you go, however, renovating a kitchen is almost always a safe investment. 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 boost the value of your home (when done well) as long as your home doesn't then become an oddball for your neighborhood in terms of size.