Loan Officer Exam Loan Officer Appraisal and Property Valuation

Question 1

How is 'market value' defined in real estate appraisal?

Accepted Answer

The most probable price a property should bring in a competitive and open market

Answer

The price a seller hopes to receive for their property

Answer

The assessed value assigned by the local tax authority

Answer

The replacement cost of the improvements on the property

Question 2

Which federal law requires lenders to provide mortgage applicants with a free copy of any written appraisal developed for a first-lien dwelling loan?

Accepted Answer

ECOA

Answer

RESPA

Answer

TILA

Answer

FIRREA

Question 3

What does an 'as-is' appraisal reflect?

Accepted Answer

The property's value in its current physical condition at the time of appraisal

Answer

The property's projected value after planned renovations are complete

Answer

An estimate of value assuming all deferred maintenance is repaired

Answer

The value assigned by the seller based on recent comparable sales

Question 4

What does the abbreviation 'URAR' stand for in mortgage lending?

Accepted Answer

Uniform Residential Appraisal Report

Answer

Universal Real Appraisal Report

Answer

United Realty Assessment Record

Answer

Underwriter's Real Asset Review

Question 5

Which organization establishes the Uniform Standards of Professional Appraisal Practice (USPAP) that govern federally related transactions?

Accepted Answer

The Appraisal Foundation

Answer

Federal Housing Administration (FHA)

Answer

Appraisal Subcommittee (ASC)

Answer

Federal Reserve Board

Question 6

A 'drive-by' appraisal is best described as which type of appraisal?

Accepted Answer

An exterior-only inspection appraisal where the appraiser does not enter the property

Answer

An automated valuation model generated without any site visit

Answer

A broker price opinion prepared by a real estate agent

Answer

A desktop appraisal based entirely on public records

Question 7

Under FIRREA, which real estate transactions require an appraisal by a state-licensed or state-certified appraiser?

Accepted Answer

Federally related transactions that exceed established de minimis thresholds

Answer

All real estate sales regardless of transaction amount

Answer

Non-federally related private transactions only

Answer

Only commercial property transactions above $500,000