Absolute Value, Inc.
745 Atlantic Avenue, 8th Floor
Boston, MA 02111
(p) 617.391.0000 (f) 617.507.7909
An appraisal is a tool not only utilized by mortgage lenders. Homeowners, assessor's offices, attorneys, buyers and sellers order appraisals to meet a variety of valuation needs. Mortgage lenders order appraisals to verify a property's worth for prospective financing. The mortgage industry relies upon a qualified, independent, real estate appraiser to guide them in their financing decisions. Others call on a professional appraiser when a valuation is required to guide them personally in their financial decisions regarding any of the following situations:
Private Mortgage Insurance Removal
Private Mortgage Insurance (PMI) is the supplemental insurance that many lenders have to purchase when the amount being loaned is more than 80% of the value of the home (LTV, loan-to-value). This additional PMI payment is often folded into the monthly mortgage payment and is soon overlooked. After a rise in values and/or payment to principal goes below this 80% level, PMI is no longer required. United States Congress passed a law in 1998 (the Homeowners Protection Act of 1998) that requires lenders to remove the PMI payments when appropriate. An appraisal is required to determine the property's value in order for the homeowner to verify that the LTV ratio conditions have been met.. The costs of the appraisal services are recovered in just a few months of not paying the PMI.
Property Tax Assessments
Challenging a tax assessment has become a necessity in many parts of the country. Unfortunately, most people approach these challenges unprepared. They may pull some general information from the Internet, but have no concrete basis to support their claims. A real estate appraiser can provide accurate answers to the question of value. While it may not be economical to commission a full appraisal to save a few hundred off your tax bill, often an appraiser can do a limited appraisal for much less – providing the same conclusions backed by professional integrity. An appraisal from a qualified appraiser would be a step in the right direction in any dispute with your local tax assessor.
In times of loss, it is often difficult to think of the various steps that must be taken to resolve any outstanding financial responsibilities of the deceased. An appraisal is required to establish fair market values of any real estate properties in the estate for the purpose of tax filings and any required presentation to multiple heirs. The aid of an appraisal is a necessity to properly reconcile the estate.
In unfortunate circumstances, such as divorce, appraisals are required to ensure that both parties involved receive a fair and impartial value of any real estate. This allows those involved to concentrate on the more important personal aspects of such a difficult time. An appraisal by a qualified, independent, professional third party is often required by state law to settle a divorce.
Feasibility - Land Utilization Studies
Often appraisals are required when townships are planning certain uses of land such as rezoning, implementation of housing developments, traffic infrastructure, cost benefit analysis and/or a whole host of various projects. The appraiser’s responsibility in delivering an accurate appraisal report is a necessary response to the question of fair market value.