CRU Property Appraisal & Valuation Flashcards
6 cards from real CRU practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 CRU Property Appraisal & Valuation flashcards as text
Which appraisal approach estimates a property's value by analyzing the cost to replace or reproduce the improvements minus depreciation, plus land value?
Answer: Cost approach
The cost approach values a property by estimating the land value plus the depreciated cost of reproducing or replacing the improvements.
An appraiser identifies three comparable sales that bracket the subject property's value. What is the primary purpose of 'bracketing' in the sales comparison approach?
Answer: To ensure comparables bound the subject above and below in key characteristics
Bracketing means selecting comparables with features both superior and inferior to the subject to support value adjustments from both directions.
Which of the following best describes 'effective age' in a residential appraisal?
Answer: The age implied by the property's condition and utility relative to new construction
Effective age reflects how old the property appears functionally and physically, which may differ from its actual chronological age.
A residential property has a swimming pool while none of the comparable sales do. How should the underwriter treat this during appraisal review?
Answer: Require the appraiser to add a positive adjustment to the comparables
Because the subject has a feature the comparables lack, the appraiser must add value to the comparables to make them equivalent to the subject.
Under FNMA guidelines, what is the maximum age of an appraisal report that can be used for a conventional loan at the time of note date?
Answer: 6 months for existing and 12 months for new construction
Fannie Mae allows appraisals up to 12 months old for new construction and up to 12 months for existing properties when an appraisal update is provided, but the standard effective date limit is 12 months with updates permitted.
Which form is most commonly used by appraisers for a standard single-family residential appraisal on a conventional loan?
Answer: Form 1004
Fannie Mae Form 1004 (Uniform Residential Appraisal Report) is the standard form for single-family properties.