Module 14 Flashcards
latest version of the URAR form
(Fannie Mae Form 1004, March 2005)
Form 1004D
Appraisal Update and/or Completion Report
Form 2055
Exterior Inspection Only Residential Appraisal Report
most commercial appraisals involve
narrative reports.
he current version of the URAR form was designed by
Fannie Mae
specifically to be used for appraisals that support loan packages to be sold in the secondary market.
Agencies such as HUD, FHA, and VA may continue to use the old form for residential valuation
If the intended use of your appraisal is for anything other than Fannie Mae, you should (and will want to) continue to use the previous version.
There are 11 sections in the URAR form.
11
With most appraisals, the effective date used is
the date of inspection
The principle of ______ contends that properties generally have a higher value and greater marketability when their size, topography, and other site conditions are similar to other properties in the market area.
principle of conformity
If the site was irregular, you would
need to attach an addendum containing a sketch of the site
ypically, appraisers will identify whether or not the site is a corner lot by using
the blank comments area in the “Site” section
The legally permitted uses of a site make up its
general use.
Form 1025
small Residential Income Property Appraisal Report
Density of use. Questions to determine density of use include
How many units are permitted?
Can the units be clustered?
Are green belts permitted or required?
Specific requirements
Possibilities include setback, building height
restrictions, lot coverage ratios, parking restrictions, and sign regulations.
Nonconforming
ou must identify whether the current use complies with
the zoning for the site.
A “grandfathered use” means that the use is nonconforming to the
current zoning. However it is permitted and thus it is a legal use.
You must investigate zoning rules regarding the ability to rebuild
the current improvements in the event they are substantially
damaged (such as in the case of a fire or flooding).
If the current use is illegal, you must find out the specific
conditions that would make the property legally conforming to the
zoning ordinance. Conformity might not be financially feasible.
Highest and best use as improved.
You must comment if another highest and
best use is indicated rather than its present use
Site characteristics
Use descriptive terms to identify the characteristics of
shape, view, orientation, and topography.
Comments in the Site section
Use the blank lines at the bottom of the Site section to discuss relevant
site and land issues that a client might want to know.
Adverse site conditions or external factors
Special assessments, easements, and encroachments
Private well and septic systems, cisterns, and drainage pond on site
Steep grades, slide areas, soil and drainage conditions
Special views (favorable and unfavorable)
Orientation (south-facing site may be preferable in some areas)
Flooding potential (property is within a designated flood zone)
Zoning issues such as illegal or legal nonconforming zoning uses
and highest and best use issues
Avoid “canned” comments used as filler such as
“no apparent adverse
conditions noted.” Lending clients find these statements to be of little
value. If no comments are necessary, then simply state “none.”
high-performance properties are more adequately described using
e Appraisal Institute’s Residential Green and Energy Efficient Addendum (Links to an external site.) report form (820.04).
Units
This is specific to all levels above grade. This heading permits only a one-family or one family with an accessory unit to be appraised
Detached.
The subject is a detached (free-standing) single-family residence. An example of an attached residence might be a townhome or patio home that has shared (common) party walls.
Existing
Our subject is an existing residence, as opposed to being proposed or currently under construction.
Design (style).
It is best to stick to the basics, such as one-story, two-story, four-level split, etc., and stay away from terminology such as “Pennsylvania Dutch colonial” or “brownstone” which may have multiple interpretations in various parts of the country.
Year Built
Provide the chronological age rather than the year built. This makes it easy for the client to compare actual age and effective age
Attic
Our subject has an attic that is accessible from a scuttle (an opening in the ceiling without stairs).
The “Basement Finish”
is normally entered as a percentage
Window Type. If there are a variety of window types in one residence
choose the predominant type and list it on the form. Some of the more common window types are casement windows, which have cranks to open both sides from the center; double hung windows which have both the upper and lower sections that can slide up or down; and awning windows, where the entire window opens in an outward direction from the bottom.
The finished area above grade is asking for
above-grade room count. Place the actual number of rooms (not the dimensions or area size) in each room space.
If the R-values of the insulation are known (e.g., new construction), that data can be placed in the spaces. Otherwise,
use terms such as good, average, or poor.
Adverse physical deficiencies: Be aware of the 3-S Rule
Safety, Soundness, and Security.
he Fannie Mae Form 1004 that we have been discussing is not designed to be used in
appraising manufactured housing
Did you know that there hasn’t been a mobile home built in the United States since
June 15, 1976? Today, a factory-built housing includes manufactured homes, modular homes, and other types of prefabricated, panelized, or sectional housing
The housing must be legally classified as real estate (not personal property)
The towing hitch, wheels, and axles must be removed and the dwelling must assume the characteristics of site-built housing.
What unit of comparison is appropriate in the appraisal of a hotel?
D. price per guest room
Which type of market would provide the best market conditions for an appraiser to
employ the sales comparison approach?
active market
What type of factory-built structure must have a HUD seal affi xed to the exterior?
manufactured home
A buyer paid more for a property because he was uninformed about the cost to
petition for a zoning change. What element of comparison would this fall under?
expenditure made immediately after purchase
Lenders concerned about adverse conditions affecting a property may require
appraisers to apply the 3-S Rule, which stands for
A. safety, soundness, and security.
Which of the following is true regarding room counts?
bedrooms and baths are included
special rooms such as foyer, laundry room, and dinette are excluded
only above grade rooms are included
all of these answers
The effect on value produced by a property’s location at or near the intersection of two streets is known as
corner influence.
Corner influence is the effect on the value produced by a property’s location at or near the intersection of two streets or the increment of value or loss in value, resulting from this location or proximity.
For an appraiser to appraise manufactured housing, it must
be legally classified as real estate (not personal property).
assume the characteristics of site-built housing.
be all of these answers.
have the towing hitch, wheels, and axles removed.
Which of the following would be an acceptable way of describing the boundaries of an irregular shaped lot?
The lot is 80 x 160 x 95 x 200.
The lot is triangular in shape and contains approximately 2.51 acres.
The lot is very irregular in shape. Please refer to the attached sketch.
All of these answers are correct.
Where do appraisers generally obtain site size information for residential properties?
county tax assessor’s office
Site size information is often obtained from the county tax assessor’s office or another source of legal record. Data service providers sometimes provide this information as well. Regardless of the source, the appraiser should verify it and make an effort to determine the site size.
What is the effective age?
the appraiser’s opinion
The use of the cost approach and the income approach are
not required by Fannie Mae.
