Barbara Banis has answers to "Frequently Asked Questions"


	Barbara Banis is eager to answer any concerns you might have about appraisals or real estate in Marana and Pima County. Don't hesitate to contact us today.

What is an appraisal?
Describe what an appraiser does
Why would someone request services from Barbara Banis?
How is an appraisal different than a home inspection?
My agent performed a CMA for me. Is that the same as an appraisal?
What can I expect to see in my appraisal report?
Once the assignment has been delivered, what assurance is there that the value indicated is trustworthy?
How hard is it to become certified?
Who hires Barbara Banis
Where does Barbara Banis get the data used to estimate values in Pima County or other areas?
Why do I need a professional appraisal?
What exactly is PMI and how can I get rid of it?
How do I get ready for the appraiser?
What does "Market Value" mean?
Who actually owns the appraisal report?
How can I get the most ROI out of home improvements?

What is an appraisal? (Return to top)

The procedure of producing an appraisal report deals with an estimation which forms an opinion of value. The appraiser must use a number of "approaches," typically three, to come to the estimation of market value. One of them is the Cost Approach - which is how much it would cost to replace the improvements, less physical deterioration and other factors, then adding the land value. Another of the processes is the Sales Comparison Approach - which deals with discovering a comparison to other similar properties within a close proximity which have recently sold. 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 homes is the Income Approach, which is commonly used to determine the value of a property based on what an investor would pay based on the capital produced by the property.

Describe what an appraiser does (Return to top)

An appraiser forumlates a fair and credible determination of market value, often in the context of a real estate exchange. Appraisers reveal the details of their expert conclusions in appraisal reports.

Why would someone request services from Barbara Banis? (Return to top)

There are a lot of reasons to get an appraisal with the usual reason being real estate and mortgage transactions. Some other reasons for obtaining an appraisal include:

If you are applying for a loan.
If you would like to lower your property tax obligations.
To build a case for a homeowner's equity and remove insurance.
To fight inflated property taxes.
To settle an estate.
To provide you a negotiating tool when purchasing real estate.
To determine a reasonable property value 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 ever find yourself in a lawsuit.

If you need more information about the appraisal process, please click here.

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

Appraisers do not do perform house inspections and are not home inspectors. A third-party home inspector will inspect the structure of the home, from the roof to the bottom. The general property inspector's report will contain an evaluation of the integrity 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.

My agent performed a CMA for me. Is that the same as an appraisal? (Return to top)

Simply put, it's like comparing sugar and saccharin. What the CMA relies upon are ill-defined trends. An appraisal is based on comparable sales that can be verified by public record. The appraisal report will also contain neighborhood and building prices. All a CMA does is generate a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

Who's behind the report is actually the biggest difference between a CMA and an appraisal. A CMA is written by a real estate agent who may or may not have a true grasp of the market or valuation concepts. A certified, state licensed professional who has formed a career on valuing homes in and around Pima County is behind 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 flat sum for assignments, regardless of their outcome.

What can I expect to see in my appraisal report? (Return to top)

Each appraisal should demonstrate a believable estimate of value and should identify the following:

The client and other intended users.
The intended use of the appraisal.
The appraisal's purpose.
Precisely what "value" attribute is being reported and what that value means.
The effective date of the appraisal.
Relevant property characteristics, including: location, physical description, legal attributes, economic attributes, the real property interest in question, and non-real estate items included in the valuation, such as personal property, trade fixtures and even intangible items.
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 detailed look at all that goes into an appraisal report click here: Sample Appraisal Report

Once the assignment has been delivered, what assurance is there that the value indicated is trustworthy? (Return to top)

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

That the information analysis contained in the appraisal was suitable.

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

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

The final appraisal report was understandable, credible and defensible.

To become a state licensed appraiser, there are extensive education requirements as well as real world experience that must be logged. In addition, appraisers must follow a meticulous industry code of ethics and comply with national standards of practice for real estate appraisal. The tenets for working up an appraisal and communicating its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).

(Return to top) Licensing and certification requires classroom study, tests and practical experience. Once licensed, he/she is required to engage in continuing education courses in order to keep the license up to date. To see the specific requirements for any state click here.

Who hires Barbara Banis (Return to top)

Typically, appraisers are hired by lenders to render a value opinion on property involved in a loan transaction - to make sure the subject is indeed adequate collateral for the loan. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.

Where does Barbara Banis get the data used to estimate values in Pima County or other areas? (Return to top)

Collecting information is one of the main tasks an appraiser does. Data can be split into Specific or General. Specific data is taken from the home itself; Location, condition, amenities, size and other specific data are gathered by the appraiser during an inspection.

General data is received from a numerous places. Local Multiple Listing Services (MLS) have data on recently sold homes that could be used as comparables. To double-check actual sales prices, we look at items in the assessor's office and other public documents that are usually online nowadays. Flood zone data is available from FEMA data outlets, such as a la mode's InterFlood servers.

And last but not least, the appraiser gathers 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? (Return to top)

An appraisal is a valuable tool anytime the value of your home is pertinent to some financial decision. When selling your home, an appraisal assists you in setting 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 Barbara Banis is the best way to ensure assets are split up fairly. A home is often the single, largest financial asset anybody owns. Don't make decisions in the dark with a professional appraisal.

What exactly is PMI and how can I get rid of it? (Return to top)

PMI is the common abbreviation for for Private Mortgage Insurance. It guards the lender in case a borrower is unable to pay on the loan and the value of the home is less than what is owed on the loan. 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.


	The money you keep from getting rid of the PMI required when you got your mortgage will make up for the price of the appraisal in no time. Barbara Banis is in the business of tracking real estate value trends in Marana and Pima County. Contact us today.

How do I get ready for the appraiser? (Return to top)

The first step in most appraisals is the home 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 we have easy access to the exterior of the house . Trim any shrubs and relocate any items that would get in our way while we 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).
Any documents, such as a title policy with information on encroachments or easements encroachments or easements.
Information on "Homeowners Associations" or condominium covenants and fees.
A copy of the current listing agreement and broker's data sheet and Purchase Agreement if a sale is "pending".
A bill for your most recent real estate taxes which should also contain a legal description of the property.

What does "Market Value" mean? (Return 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."

Who actually owns the appraisal report? (Return to top)

For mortgage transactions, the lender requests the appraisal, either directly or through a third party. 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 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.

It's different when it's the homeowner engaging the appraiser for things outside securing a mortgage. 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 use the appraisal for any purpose.

How can I get the most ROI out of home improvements? (Return to top)

Like all things real estate, this is dependent on a home's location. 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 best ROI 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 weren't far behind, yielding 85%. Adding bedrooms and baths can also help the value of your home as long as your home doesn't then become an oddball for your neighborhood in terms of size.