Residential Report Writing and Case Studies

Question 1

Kristin develops an opinion of value, prepares it in a written format, and mails it to her client. What has she mailed to the client?

Answer 1

A report

Question 2

In the development of an appraisal on a two-unit residential property, Jared completes the income approach. Which statement is TRUE regarding his reporting obligations?

Answer 2

He must report the results of the income approach.

Question 3

There is no difference between the meanings of the terms appraisal and appraisal report.

Answer 3

False

Question 4

In the development of a real property appraisal, the value opinion must be:

Answer 4

Credible

Question 5

In the reporting of a real property appraisal, it is important that the report is NOT:

Answer 5

Misleading & Fraudulent

Question 6

Eve is appraising a single-family home for a mortgage loan. Where should she go for information regarding what form or format to use in her appraisal report?

Answer 6

The client/intended users

Question 7

A retrospective appraisal involves an effective date that is___________.

Answer 7

Some time in the past

Question 8

Once the scope of work decision has been made by the appraiser, it cannot later be modified.

Answer 8

False

Question 9

What may happen if the client provides the appraiser with incorrect or incomplete property information?

Answer 9

A non-credible value opinion may result

Question 10

Most residential appraisers use the unit-in-place method of estimating cost new.

Answer 10

False

Question 11

Highest and best use analysis is mandatory in all real property appraisal assignments.

Answer 11

False

Question 12

A garage building has an effective age of 5 years and a total economic life of 25 years. What is the percentage of accrued depreciation by the age-life method?

Answer 12

20%

Question 13

Written appraisal reports must contain sufficient information so that _______ can properly understand them.

Answer 13

Intended users

Question 14

Reconciliation is the process of averaging the indications of the approaches to value into a final value indication.

Answer 14

False

Question 15

What is the final step in the overall appraisal process?

Answer 15

Reporting the appraisal

Question 16

“Intended to deceive” is the definition of:

Answer 16

Fraudulent

Question 17

Earl is appraising a parcel of real property for a mortgage loan. What is the best source to obtain the information he needs for problem identification?

Answer 17

The client

Question 18

Most mortgage lending appraisal assignments require an opinion of ______ value.

Answer 18

Market

Question 19

What type of income approach is typically used for small residential properties?

Answer 19

Gross rent multiplier

Question 20

STANDARD __ covers real property appraisal development, and STANDARD __ covers real property appraisal reporting.

Answer 20

1, 2

Question 21

In the development of an appraisal on a two-unit residential property, Jared completes the income approach. Which statement is TRUE regarding his reporting obligations?

Answer 21

He must report the results of the income approach.

Question 22

The appraisal development process:

Answer 22

Is an intellectual process

Question 23

The income approach is based on the principle of ________.

Answer 23

Anticipation

Question 24

The terms appraisal and report:

Answer 24

Are not synonymous

Question 25

The second step in the appraisal process was formerly called preliminary survey. What is this step now called?

Answer 25

Determine scope of work

Question 26

Eve is appraising a single-family home for a mortgage loan. Where should she go for information regarding what form or format to use in her appraisal report?

Answer 26

The client/intended users

Question 27

A home has an outdated kitchen, which can be remedied at a cost of $10,000. After the kitchen is updated, the value of the home will increase from $124,000 to $133,000. What type of depreciation is this?

Answer 27

Functional, incurable, Outdated fixtures and cabinetry, and poor floor plans are examples of functional obsolescence. The cost to cure ($10,000) is more than the resulting increase in value ($9,000) so this depreciation is considered incurable. (Ch 1, Cost Approach: Depreciation)

Question 28

Which of these is NOT one of the criteria for highest and best use?

Answer 28

Socially acceptable

Question 29

The same amount of information must appear in every written appraisal report.

Answer 29

False

Question 30

Sandy is appraising an income property for a very knowledgeable client. Which statement is TRUE regarding how much information Sandy must insert in her appraisal report?

Answer 30

Because the client is knowledgeable, Sandy may put less information in the report.

Question 31

USPAP STANDARD 2 establishes ________ requirements for real property appraisal reports.

Answer 31

Minimum

Question 32

What distinguishes an extraordinary assumption from an “ordinary” assumption?

Answer 32

An extraordinary assumption is directly related to a specific assignment. While an “ordinary” assumption may be made in virtually every appraisal assignment, an extraordinary assumption is directly related to a specific assignment.

Question 33

An appraiser’s assumption that the subject property has clear and marketable title is an example of:

Answer 33

Assumption

Question 34

Kate notes an underground storage tank on a property she is appraising. The property owner gives her a copy of an environmental expert’s report stating that the tank had leaked diesel fuel into the ground, and there was significant contamination which was never remediated. In appraising this property, can Kate employ an extraordinary assumption that the property is free of contamination?

Answer 34

No, If we have a reasonable basis for an extraordinary assumption, we may utilize it in the appraisal process. In this case, Kate does not have a basis for this assumption, because she knows it is false. (Ch 2, Extraordinary Assumptions)

Question 35

If a property is appraised contrary to known fact, this would be a(n) _________.

Answer 35

Hypothetical condition, A hypothetical condition is something that is contrary to what is known by the appraiser to exist on the effective date of the assignment results.

Question 36

An appraiser may use another label in place of the report option label required by USPAP Standards Rule 2-2.

Answer 36

False

Question 37

In a written real property appraisal report, USPAP requires that a statement of the reporting option must be ___________.

Answer 37

Prominent

Question 38

Ricky has been asked to appraise a property for an out-of-state client, who has very little knowledge of the property. The intended use would necessitate a high level of information in the report; however, since there are no other intended users, Ricky wonders if he should use a Restricted Report format. What does USPAP state about this situation?

Answer 38

A Restricted Report is not permissible because the client and intended use would dictate a higher level of content and detail

Question 39

Brett prepares a written report labeled “Appraisal Report;” however, the level of information is not consistent with the requirements of such a report. He sends the report to his client. Which statement is TRUE regarding this situation?

Answer 39

He has violated USPAP by communicating a misleading report.

Question 40

As part of an appraisal assignment, Kara has completed a subject property sales history and current listing and agreement analysis. In her Restricted Appraisal Report, she must _________ this information.

Answer 40

Summarize

Question 41

What are the operative words that establish the differences between the two USPAP written report options?

Answer 41

Summarize, state

Question 42

In a written real property appraisal report, USPAP requires that a statement of the reporting option must be ___________.

Answer 42

Prominent

Question 43

An appraisal report must be written so that _____ can understand it.

Answer 43

the client and intended users

Question 44

As part of an appraisal assignment, Kara has completed a subject property sales history and current listing and agreement analysis. In her Restricted Appraisal Report, she must _________ this information.

Answer 44

Summarize

Question 45

Irving is appraising a proposed new home, based on plans and specifications. He is appraising the property as though the new home has been completed as of a current effective date; however, it is actually a vacant lot. This is an example of:

Answer 45

A hypothetical condition

Question 46

What is the role of Advisory Opinion 11 with regard to appraisal reporting?

Answer 46

Provides guidance and advice

Question 47

The form or format of an appraisal report:

Answer 47

Is not dictated by USPAP

Question 48

USPAP STANDARD 2 establishes ________ requirements for real property appraisal reports.

Answer 48

Minimum

Question 49

Sandy is appraising an income property for a very knowledgeable client. Which statement is TRUE regarding how much information Sandy must insert in her appraisal report?

Answer 49

Because the client is knowledgeable, Sandy may put less information in the report.

Question 50

Under USPAP, disclosure of extraordinary assumptions and hypothetical conditions must be clear and ___________ .

Answer 50

conspicuous

Question 51

An appraiser’s lender-client asks the appraiser to use the Fannie Mae URAR form to report his appraisal. This client is essentially asking for a:

Answer 51

Appraisal Report

Question 52

Zoe is asked to provide an oral appraisal report. What is the USPAP requirement for oral reports?

Answer 52

To the extent possible and appropriate, oral appraisal reports must meet the requirements for an Appraisal Report.

Question 53

Barb is reporting an appraisal of a single-family home, using a URAR form. What is the BEST way to ensure that her report meets the requirements for an Appraisal Report?

Answer 53

Meet the minimum content requirements set forth in USPAP

Question 54

Jeremy is asked to complete an appraisal by a mysterious client, who will not tell him exactly why he wants to have the property appraised. Does USPAP permit Jeremy to accept the assignment in this situation?

Answer 54

No

Question 55

An appraiser is engaged by an appraisal management company (AMC) who is acting as an agent of the lender. The AMC requests that the appraiser put the lender’s name on the appraisal report as the client. Which statement is TRUE about this situation?

Answer 55

The lender is the client.

Question 56

Lola completes an appraisal for a property owner, and sends him the report. Two weeks later, the property owner calls and asks Lola to add ABC Bank onto the appraisal report as an intended user. What are Lola’s obligations under USPAP?

Answer 56

She is not permitted to retroactively add intended users.

Question 57

An appraiser may base a value opinion on special, non-market financing terms.

Answer 57

True

Question 58

In appraisals for federally-regulated lending institutions, the source of the market value definition commonly used by appraisers is:

Answer 58

FIRREA

Question 59

What is an acceptable format for communicating an Appraisal Report?

Answer 59

Fannie Mae 1004 form, Fannie Narrative format Mae 2055 form

Question 60

An appraiser is preparing a retrospective appraisal. Which statement is TRUE regarding the effective date?

Answer 60

It will be prior to the date of report.

Question 61

For an appraisal for a Fannie Mae lender, the effective date of the appraisal is the date the property was inspected.

Answer 61

True, Fannie Mae and Freddie Mac require that the effective date must be the date that the property was inspected.

Question 62

Which statement is TRUE regarding disclosure of scope of work in an Appraisal Report?

Answer 62

It may consist of small summaries located in various places throughout the report, It must be summarized and It may include disclosure of both work that was done, and work that was not done.

Question 63

The certification statement used in a written real property appraisal report must be used exactly word-for-word as it appears in USPAP Standards Rule 2-3.

Answer 63

False, The certification used must be similar in content to USPAP; it does not have to be word-for-word. (Ch 3, SR 2-2 a xi)

Question 64

Howard appraised a property for a very secretive client, who instructed him not to disclose to anyone that he had appraised the property. Twenty-seven months later, Howard receives an appraisal request from another client. What are Howard’s USPAP obligations?

Answer 64

He must decline the assignment. If the prior client had instructed the appraiser not to even disclose the mere occurrence of the assignment, the appraiser must decline all assignment requests on the subject property for the duration of the three-year disclosure period. (Ch 3, SR 2-2 a xi)

Question 65

In a Restricted Appraisal Report on a single-family residence, the exclusion of the income approach __________.

Answer 65

Must be explained, Regardless of the report type, the exclusion of the sales comparison, cost, or income approach must be explained.

Question 66

In an Appraisal Report, the appraiser’s opinion of highest and best use must be __________.

Answer 66

Summarized

Question 67

If an appraisal report indicates three comparable sales adjusted to indicate $210,000, $220,000 and $230,000, the appraiser is not required to explain why he or she reconciled the value indication at $220,000.

Answer 67

False

Question 68

In a Restricted Appraisal Report on a single-family residence, the exclusion of the income approach __________.

Answer 68

Must be explained

Question 69

An appraiser is preparing an appraisal with an effective date of July 3rd. The report is dated July 5th. This would most likely be a ____________.

Answer 69

Current appraisal

Question 70

Which term BEST describes the Fannie Mae 1004 (URAR) form?

Answer 70

A container for a report

Question 71

Which report option specified in USPAP is the most detailed?

Answer 71

Appraisal Report

Question 72

Jeremy is asked to complete an appraisal by a mysterious client, who will not tell him exactly why he wants to have the property appraised. Does USPAP permit Jeremy to accept the assignment in this situation?

Answer 72

No

Question 73

An appraiser is required to state _____ dates in every Appraisal Report.

Answer 73

two

Question 74

Brenda prepares an Appraisal Report, in which she states, word-for-word, the market value definition she is using. What other USPAP reporting requirements (if any) does she have regarding her definition of value?

Answer 74

She must cite the source of the definition.

Question 75

James is appraising a proposed new home, and he believes the cost approach is necessary for credible results. However, the URAR form states the cost approach is not required. What should he do?

Answer 75

Complete the cost approach

Question 76

Fannie Mae and Freddie Mac are responsible for creating most of the commonly-used residential appraisal report forms.

Answer 76

True

Question 77

What is a reason why residential appraisers are often “form-focused”?

Answer 77

Forms have been standardized by Fannie Mae and Freddie Mac

Question 78

Secondary market appraisal guidelines are intended to take the place of USPAP.

Answer 78

False

Question 79

For real property appraisal reports, USPAP compliance is determined by:

Answer 79

Content

Question 80

The most requested residential appraisal report is the:

Answer 80

URAR report

Question 81

The Fannie Mae 1004 form may be used to report an appraisal on:

Answer 81

Units in planned unit developments

Question 82

Fannie Mae’s pre-printed scope of work in the URAR form requires an appraiser to:

Answer 82

Perform a complete visual inspection of the interior and exterior of the subject property, Inspect the neighborhood and Inspect the comparable sales from the street

Question 83

HUD/FHA and VA have adopted the 1004 (URAR) appraisal report form.

Answer 83

True

Question 84

By fully filling out the URAR form, an appraiser has met his or her USPAP requirements for reporting.

Answer 84

False

Question 85

There have been 45 sales in the subject neighborhood within the last 9 months. There are 35 properties currently listed for sale on the market. How many months’ inventory is currently on the market?

Answer 85

7

Question 86

The requirement to research prior listings of the subject within the last 12 months is a(n):

Answer 86

Fannie Mae/Freddie Mac requirement

Question 87

Generally speaking, Fannie Mae and Freddie Mac will not purchase a mortgage on a property that is an illegal use.

Answer 87

True

Question 88

A rectangular property measures 800’ x 900’. How would the site size be reported on the URAR form?

Answer 88

16.53 ac

Question 89

In a Fannie Mae appraisal, which FEMA zones would be considered special flood hazard areas?

Answer 89

Zones A and V

Question 90

An appraiser may not add limiting conditions to the URAR form, but is permitted to add additional certifications.

Answer 90

True, Appraisers are not permitted to add any additional assumptions or limiting conditions. Additions (such as those required by the individual state or by an appraisal association, for their designated members) are acceptable and are allowed as additional certifications

Question 91

At the top of page 2 of the URAR form, which listings and sales should be considered and reported?

Answer 91

Only properties that are comparable to the subject property

Question 92

USPAP sets forth guidelines establishing how recent and proximate comparable sales must be.

Answer 92

False

Question 93

James is appraising a proposed new home, and he believes the cost approach is necessary for credible results. However, the URAR form states the cost approach is not required. What should he do?

Answer 93

Complete the cost approach

Question 94

What is another name for a legal non-conforming use?

Answer 94

Grandfathered use

Question 95

Each of the report options outlined in Standards Rule 2-2 (a) and (b) has ___ numbered minimum content requirement items.

Answer 95

12

Question 96

Jamal receives an appraisal assignment from a lending institution. What should NOT be a consideration for Jamal when he determines the scope of work for the appraisal development process?

Answer 96

The report form the client has requested

Question 97

What is the primary reason for analyzing sales history of the subject and comparable sales?

Answer 97

Determine that flipping actions have not occurred, The purpose of this research is to ensure that illegal “flipping” actions have not occurred with either the subject or the comparable sales used in the sales comparison approach. This research can be an indication of market trends, but that is not its primary purpose

Question 98

When appraising a single-family home, an appraiser decides not to develop the income approach. What is the appraiser’s requirement for reporting this on the URAR form?

Answer 98

Explain the reason the approach was not developed

Question 99

The URAR form has been identified by the ASB as generally meeting the reporting requirements for a(an):

Answer 99

Appraisal Report

Question 100

Ty receives a single-family appraisal request from a small local bank which does not sell loans on the secondary mortgage market. Which appraisal reporting format is this client most likely to request?

Answer 100

A form created by Fannie Mae

Question 101

USPAP sets forth guidelines establishing how recent and proximate comparable sales must be.

Answer 101

False

Question 102

Special flood hazard areas, as identified by FEMA, include:

Answer 102

Zones A and V

Question 103

What is a reason why residential appraisers are often “form-focused”?

Answer 103

Forms have been standardized by Fannie Mae and Freddie Mac

Question 104

In a Fannie Mae appraisal, which FEMA zones would be considered special flood hazard areas?

Answer 104

Zones A and V

Question 105

Which party is ultimately responsible for compliance with Fannie Mae and Freddie Mac policies and initiatives?

Answer 105

The lender

Question 106

Which statement is FALSE regarding Fannie Mae?

Answer 106

It is currently a federal government agency.

Question 107

The appraisal data requirements of the UAD apply to which type of loans?

Answer 107

Conventional, FHA and VA

Question 108

Appraisals reported on which Fannie Mae forms will require compliance with the requirements of the Uniform Appraisal Dataset?

Answer 108

1004, 2055, 1073, 1075

Question 109

As part of the implementation of the Uniform Appraisal Dataset (UAD), Fannie Mae and Freddie Mac changed the layout and format of several appraisal report forms.

Answer 109

False, While the appraisal forms themselves were not changed as part of the UAD, the GSEs did change some of the input requirements for the form fields.

Question 110

The Uniform Appraisal Dataset changed _________.

Answer 110

Input requirements for certain fields on appraisal report forms

Question 111

“The appraiser should enter a neighborhood name” is an example of:

Answer 111

An instruction

Question 112

“The appraiser must enter all applicable homeowners’ association (HOA) fees associated with the subject property” is an example of:

Answer 112

A requirement

Question 113

Which of these statements is TRUE regarding GSE requirements and USPAP?

Answer 113

GSEs require USPAP compliance.

Question 114

Marian is appraising a single-family home where the property tax year spans 2019 and 2020. In her UAD report, what should she put under “Tax Year”?

Answer 114

2019

Question 115

Tom is appraising a single-family home with an accessory unit. The home is occupied by the property owner, and the accessory unit is vacant. Under “Occupant” on the 1004 form, Tom must:

Answer 115

Check the “Owner” box

Question 116

Under the requirements for UAD, if an appraiser determines that property values in the neighborhood are “stable to increasing”, she may check both the “stable” and “increasing” boxes in the neighborhood section of the URAR form.

Answer 116

False

Question 117

The UAD requires an appraiser to rate the subject property’s overall view as:

Answer 117

N, B, or A

Question 118

If a home has three full bathrooms and two half-bathrooms above grade, how must the appraiser indicate the bathroom count according to the UAD?

Answer 118

3.2

Question 119

In an appraisal report prepared under the UAD, how is a three-quarter bathroom to be considered in the room count?

Answer 119

As a full bathroom

Question 120

A comparable property closed (settled) on June 5, 2020. Under the requirements of UAD, what would be the appropriate format to enter the settlement date in the sales comparison grid?

Answer 120

06/20

Question 121

As per the UAD, what information is required to be inserted in the “Name” field, in the “LENDER/CLIENT” section on page 6 of the 1004 form?

Answer 121

The AMC name, if applicable

Question 122

The subject property has a two-car attached garage. Comp 1 also has a two-car attached garage. What should the appraiser enter in the sales comparison grid in the adjustment field for this item?

Answer 122

The field should be left blank

Question 123

“Significant finish and/or structural changes have been made that increase utility and appeal through complete replacement and/or expansion” is the definition of __________.

Answer 123

Remodeled

Question 124

“The area of the home has been modified to meet current market expectations. These modifications are limited in terms of both scope and cost” is the definition of __________.

Answer 124

Updated,

Question 125

An appraiser estimates that the subject home was built in 1930, but is unable to verify this. How must the appraiser indicate this in the “Year Built” section of the 1004 form?

Answer 125

~1930

Question 126

As per the UAD, what information is required to be inserted in the “Name” field, in the “LENDER/CLIENT” section on page 6 of the 1004 form?

Answer 126

The AMC name, if applicable

Question 127

Which of these would be the MOST appropriate entry in the location section of the sales comparison grid in a UAD-compliant appraisal report?

Answer 127

A; BsyRd

Question 128

Dave is appraising a single-family home in a Planned Unit Development (PUD). The HOA fees are assessed quarterly. What does Dave need to do in order to fill out the HOA fields?

Answer 128

Convert the fee to either monthly or annual amount

Question 129

If the Assignment Type is indicated as a purchase transaction, the appraiser is required to report on sales concessions or financial assistance.

Answer 129

True

Question 130

If Fannie Mae receives an appraisal report that they believe to be fraudulent, what are they MOST likely to do?

Answer 130

Refer the matter to the appropriate state enforcement agency

Question 131

The UAD requires an appraiser to rate the subject property’s overall view as:

Answer 131

N, B, or A

Question 132

Which of these is a valid architectural style, under the UAD?

Answer 132

Rambler

Question 133

If an appraiser enters improperly formatted data into a required field on the URAR form, what will happen?

Answer 133

An error message will be generated

Question 134

Which is NOT an acceptable way to outline the subject’s neighborhood boundaries in a UAD-compliant appraisal report?

Answer 134

By referencing a map in an addendum, he appraiser should provide outlined neighborhood boundaries, using “North”, “South”, “East”, and “West.” Boundaries can include streets, waterways, municipal limits, or other natural boundaries. Appraisers should not reference a map or other addendum as the only example of neighborhood boundaries

Question 135

Which of these is a valid architectural style, according to the requirements of the UAD?

Answer 135

Farmhouse

Question 136

12 of 15 Which statement is FALSE regarding Fannie Mae?

Answer 136

It is currently a federal government agency.

Question 137

Which of these is an acceptable way to report site size under the requirements of the UAD?

Answer 137

4.25 ac

Question 138

Which document would be MOST helpful for an appraiser in understanding the requirements of the Uniform Appraisal Dataset (UAD)?

Answer 138

UAD Appendix D

Question 139

According to the UAD, view descriptors such as “None”, “Average”, or “Typical” are unacceptable.

Answer 139

True, View descriptions must be specific and understandable; descriptors such as “None”, “N/A”, “Typical”, or “Average” are not acceptable. (Neutral, Beneficial, or Adverse).

Question 140

The level of detail required by the 2055 form is generally consistent with the minimum content requirements of a(n) ___________.

Answer 140

Appraisal Report

Question 141

For an exterior-only inspection appraisal for Fannie Mae, an appraiser must perform an exterior inspection of the property, from at least the street.

Answer 141

True

Question 142

Fannie Mae last revised their forms in

Answer 142

2005

Question 143

Fannie Mae requires which approach(es) to value in the appraisal of a HUD-Code manufactured home?

Answer 143

Sales comparison and cost approaches only, In addition to completing the sales comparison approach to value, the cost approach is required by Fannie Mae and Freddie Mac as part of the appraisal process for all manufactured homes`

Question 144

When appraising a new manufactured home, an appraiser is required to report the results of the analysis of the _________.

Answer 144

Manufacturer’s invoice, On page 1, the form requires the appraiser to report the results of the analysis of the manufacturer’s invoice, if the manufactured home is new construction

Question 145

The Manufactured Home Appraisal Report, according to Fannie Mae, is consistent with the minimum content requirements for a(an) _________ report.

Answer 145

Appraisal

Question 146

When appraising a manufactured home, an appraiser needs to look for the __________ to verify that the home was constructed in accordance with federal standards.

Answer 146

HUD Label

Question 147

Nikki is appraising a modular home for a Fannie Mae lender. What form should she use to report her appraisal?

Answer 147

1004

Question 148

When appraising a new manufactured home, an appraiser is required to report the results of the analysis of the _________.

Answer 148

Manufacturer’s invoice

Question 149

Units of comparison on the 1025 form would NOT include sale price per:

Answer 149

Bathroom

Question 150

Why does the Individual Condominium Unit Appraisal Report require extensive information regarding the condominium project in which the subject unit is located?

Answer 150

Because common elements and amenities are essential to the value of a condominium unit

Question 151

Units of comparison on the 1025 form would NOT include sale price per:

Answer 151

Parking space, Both unadjusted and adjusted units of comparison, including sale price per unit, sale price per room, sale price per bedroom, and sale price per square foot of gross building area, are extracted from the comparable sales. (Ch 6, Small Residential Income Property Appraisal Report)

Question 152

When an individual purchases a unit in a cooperative project, what is he or she actually purchasing?

Answer 152

Stock in a corporation

Question 153

How does Fannie Mae require that cooperative units be valued?

Answer 153

Sales comparison approach

Question 154

A recertification of value does not change the effective date of the original appraisal.

Answer 154

True

Question 155

The form 1004MC addendum is no longer required for 1-4-family residential appraisals for Fannie Mae, Freddie Mac, and VA loans.

Answer 155

True

Question 156

The 1004MC form is best described as:

Answer 156

An addendum to an appraisal report

Question 157

The Manufactured Home Appraisal Report, according to Fannie Mae, is consistent with the minimum content requirements for a(an) _________ report.

Answer 157

Appraisal

Question 158

An appraiser completes an appraisal on a property. One year later, the appraiser is asked by the client to tell the client whether the value of the property has remained the same. Under USPAP, this assignment is ________.

Answer 158

An appraisal

Question 159

How does Fannie Mae require that cooperative units be valued?

Answer 159

Sales comparison approach

Question 160

The level of detail required by the 2055 form is generally consistent with the minimum content requirements of a (an)___________.

Answer 160

Appraisal Report

Question 161

The Form 1004MC addendum is no longer required for 1-4-family residential appraisals for Fannie Mae, Freddie Mac, and VA loans.

Answer 161

True

Question 162

The gross living area of a ______________ unit is calculated using interior measurements.

Answer 162

Condominium

Question 163

Why is it necessary for an appraiser to disclose the sources for the physical characteristics of the subject property in a report of an exterior-only inspection appraisal?

Answer 163

To enable intended users to understand the appraisal process, To facilitate intended users’ understanding of the appraisal process, the appraiser is required to identify the data source(s) used to obtain this information in the report.

Question 164

An inspection made for the purpose of ensuring that repairs have been completed in accordance with a prior appraisal is ____________.

Answer 164

A recertification of value

Question 165

For an exterior-only inspection appraisal for Fannie Mae, an appraiser must perform an exterior inspection of the property ___________________ .

Answer 165

from at least the street.

Question 166

Which statement is TRUE regarding gross living area (GLA) in an exterior-only inspection appraisal for Fannie Mae?

Answer 166

The appraiser must identify the data source for the GLA information in the appraisal report.

Question 167

Manufactured home appraisals are required to be reported on Fannie Mae form _________.

Answer 167

1004C

Question 168

The workfile for a Restricted Appraisal Report must contain sufficient information to produce an Appraisal Report.

Answer 168

True

Question 169

A narrative appraisal report can be used to comply with the minimum content requirements of a Restricted Appraisal Report.

Answer 169

True

Question 170

Which statement is FALSE regarding a narrative appraisal report?

Answer 170

A narrative report is always lengthy

Question 171

When disclosing the use of a hypothetical condition in a report, an appraiser must also include a statement that its use might have affected the assignment results.

Answer 171

True

Question 172

In a narrative appraisal report, it is considered a best practice to include a letter of transmittal.

Answer 172

True

Question 173

Which of these is a USPAP requirement?

Answer 173

The appraisal report must contain sufficient information to enable the intended users of the appraisal to understand the report properly

Question 174

Residential appraisers who primarily use form reports are usually not accustomed to discussing assumptions and limiting conditions with their clients.

Answer 174

True

Question 175

Which statement is true regarding general assumptions and limiting conditions?

Answer 175

Many appraisers attach them to the appraisal contract and require client acknowledgment before beginning the assignment. They are usually included in the addendum to the report. They limit or restrict the appraiser’s responsibilities.

Question 176

`In an appraisal report, it is not necessary to explain the meanings of acronyms such as USPAP because an intended user of an appraisal should already have a basic knowledge and understanding of appraisal terminology and USPAP.

Answer 176

False

Question 177

A productive way to start writing a narrative appraisal is to include an “Appraisal Summary” or “Summary of Salient Facts.” What should such a summary include?

Answer 177

Many of the USPAP-required items that can simply be stated

Question 178

A signed certification is an integral part of an appraisal report.

Answer 178

True

Question 179

Why is the title page important in a narrative appraisal report?

Answer 179

Because it is your opportunity to make a positive first impression

Question 180

Who determines the form, format, and style of an appraisal report?

Answer 180

The appraiser and the intended user

Question 181

Which statement is true regarding general assumptions and limiting conditions?

Answer 181

Many appraisers attach them to the appraisal contract and require client acknowledgment before beginning the assignment. They are usually included in the addendum to the report. They limit or restrict the appraiser’s responsibilities.

Question 182

In addition to the level of detail, what is the difference between an Appraisal Report and a Restricted Appraisal Report?

Answer 182

A Restricted report is only appropriate in situations where there is one intended user

Question 183

What is the best way to explain the appraiser’s highest and best use analysis in an Appraisal Report?

Answer 183

By separately explaining and describing each of the four test criteria

Question 184

Residential appraisers who primarily use form reports are usually not accustomed to discussing assumptions and limiting conditions with their clients.

Answer 184

True, Residential appraisers who primarily use form reports may not be accustomed to discussing assumptions and limiting conditions with the client, because when a client requests an appraisal be reported on the 1004 form, he or she is essentially agreeing to the pre-printed assumptions and limiting conditions that are specified on the form.

Question 185

A productive way to start writing a narrative appraisal report is to include an “Appraisal Summary” or “Summary of Salient Facts.” What should such a summary include?

Answer 185

Many of the USPAP-required items that can simply be stated

Question 186

If, in developing your appraisal, you excluded something you believe an intended user may be concerned about, what should you do?

Answer 186

Explain in the report why you did not include or address an item of such potential concern

Question 187

After you finish writing a narrative report, it is a good idea to set it aside for a day or two and then read it to ensure that it can be properly understood by intended users.

Answer 187

True

Question 188

When writing a narrative appraisal report, how might an appraiser utilize an appraisal report form?

Answer 188

As a rough guide to ensure that all pertinent information is included

Question 189

In a narrative appraisal report, general assumptions and limiting conditions are typically:

Answer 189

Included in an addendum

Question 190

What does a well-written appraisal report do for the client?

Answer 190

Instill confidence that the appraiser has properly and professionally performed the steps necessary to produce a credible opinion of value

Question 191

If, in developing your appraisal, you excluded something you believe an intended user may be concerned about, what should you do?

Answer 191

Explain in the report why you did not include or address an item of such potential concern

Question 192

What are the four sections into which some appraisal organizations recommend separating a narrative appraisal report?

Answer 192

Introduction, appraisal problem and scope of work, presentation of the data, analysis and conclusion

Question 193

Which of the following is ALWAYS an intended user of an appraisal report?

Answer 193

The client

Question 194

What is the idea behind the SCOPE OF WORK RULE?

Answer 194

Give appraisers the flexibility to treat each assignment differently

Question 195

Before an appraiser can determine an appropriate scope of work, he or she must first __________.

Answer 195

Identify the problem

Question 196

Why is proper disclosure of scope of work required by USPAP?

Answer 196

Because clients and intended users rely on the assignment results

Question 197

All interior inspections for real property appraisals should be completed in the same manner.

Answer 197

False

Question 198

If you and your client have an understanding that you are making an interior inspection of the subject property:

Answer 198

There is still a need to disclose the extent of the inspection in the report

Question 199

What does Fannie Mae require, as a minimum, for an exterior-only inspection?

Answer 199

The appraiser must view the exterior of the property from at least the street

Question 200

Eric develops an appraisal without making any inspection of the subject property. What are his disclosure obligations?

Answer 200

He must disclose in the report certification that he did not make an inspection of the subject property

Question 201

What is the usual reason that lender clients request “desktop” appraisals?

Answer 201

To save time and/or money

Question 202

Irving is asked to complete a “drive-by” (exterior-only inspection) appraisal on a single-family home in a rural area for a Fannie Mae lender. When he drives out to the property, he realizes that it cannot be seen from the road. Which statement is TRUE regarding this situation?

Answer 202

He must be able to view the property in order to perform a “drive-by” appraisal.

Question 203

If an appraiser receives significant real property appraisal assistance in an assignment, but does not disclose it in the report:

Answer 203

He has provided a misleading report

Question 204

A tightening of underwriting standards in residential mortgage lending has led to clients asking for more information in appraisal reports than ever before.

Answer 204

True

Question 205

Boilerplate statements regarding the selection and weighting of comparable sales is a “best practice” for residential appraisers.

Answer 205

False

Question 206

The current URAR form should NOT be used to report appraisals for non-mortgage lending intended uses.

Answer 206

True

Question 207

Assignment conditions would NOT include:

Answer 207

The appraisal fee

Question 208

A state passes a law requiring appraisers to keep their appraisal workfiles for a minimum of 8 years. Is this a jurisdictional exception?

Answer 208

No, A law that requires appraisers to retain their appraisal workfiles for 8 years would not be a jurisdictional exception, because nothing in the law would preclude an appraiser from complying with the USPAP minimum requirement of 5 years. An appraiser could comply with both the law and USPAP by retaining his or her workfiles for 8 years. (Ch 8, Jurisdictional Exception)

Question 209

The type and extent of an interior real property inspection will vary based on ____________ of the appraisal.

Answer 209

The intended use

Question 210

Why is proper disclosure of scope of work required by USPAP?

Answer 210

Because clients and intended users rely on the assignment results

Question 211

3 of 11 Fannie Mae and Freddie Mac require the appraiser to possess the required competency before accepting an appraisal assignment.

Answer 211

True

Question 212

If Sara does an appraisal with an exterior-only inspection:

Answer 212

She must ensure that sufficient information is available about the interior to enable her to develop credible results

Question 213

Which statement is TRUE regarding an inspection for an FHA appraisal?

Answer 213

It is more in-depth than the minimum inspection required by Fannie Mae

Question 214

If an appraiser receives significant real property appraisal assistance in an assignment, but does not disclose it in the report:

Answer 214

He has provided a misleading report

Question 215

If you and your client have an understanding that you are making an interior inspection of the subject property:

Answer 215

There is still a need to disclose the extent of the inspection in the report

Question 216

The current URAR form should NOT be used to report appraisals for ___________ intended uses.

Answer 216

Non-mortgage lending

Question 217

The SCOPE OF WORK RULE provides flexibility to the appraiser, but along with that flexibility comes ___________.

Answer 217

Responsibility

Question 218

USPAP requires a positive statement of competency in every appraisal report.

Answer 218

False, USPAP establishes no such requirement, although certain clients or client groups may mandate such a statement

Question 219

In the appraisal report, a disclosure clarifying the extent of the inspection can provide additional information to intended users, and may also ________________.

Answer 219

Limit the appraiser’s liability

Question 220

What is the net adjustment for Comp 1?

Answer 220

+$14,200

Question 221

What is the percentage of depreciation for the subject property?

Answer 221

25%

Question 222

Which sale should receive the most weight in the reconciliation process?

Answer 222

Comp 2

Question 223

What is the indicated value for the subject property by cost approach (round to the nearest $100)?

Answer 223

$199,100

Question 224

A two-story building that contains 3 units measures 28 feet by 43 feet. Two of the units have 800 square feet of GLA each, and the other unit has 650 square feet of GLA. What is the GBA for this building?

Answer 224

2,408

Question 225

A two-unit building measures 42 feet by 60 feet. There is an additional efficiency living unit in the basement, with 450 square feet. What is the GBA of this property?

Answer 225

2,970

Question 226

A two-story building that contains 4 units measures 22 feet by 61 feet. Two of the units have 650 square feet of GLA each, and the other two units have 550 square feet of GLA each. What is the GBA for this building?

Answer 226

2,684

Question 227

1 of 3 A purchaser of a single-family home is typically interested in _________ and a purchaser of a 2-4-family property is more interested in _________.

Answer 227

Amenities, income

Question 228

A comparable property has 3 units. Each unit has 5 rooms and 2 bedrooms. The property has 2,880 square feet of GBA and sold for $212,000. What is the indicated sale price per unit?

Answer 228

$70,667

Question 229

If a property has a gross monthly market rent of $1,750 and the indicated GRM is 88, what is the indicated value of the subject by income approach?

Answer 229

$154,000