Portfolio Management & Strategy Flashcards
7 cards from real FHA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Portfolio Management & Strategy flashcards as text
When an FHA appraiser's error is discovered post-closing and the lender requests a correction, what is the appropriate protocol under FHA guidelines?
Answer: Prepare an appraisal correction letter or amended report addressing only the identified error
FHA allows corrections to appraisal reports through a correction letter or amended report that specifically addresses the error while maintaining the original effective date.
In portfolio strategy, which approach best positions an FHA appraiser to handle market volatility during periods of rapidly rising interest rates?
Answer: Diversify across purchase, refinance, and REO assignment types to offset volume swings in any one category
Diversifying across transaction types buffers revenue impact because purchase and refinance volumes typically move inversely during rate cycles, while REO volume often increases in downturns.
Under FHA Handbook 4000.1, which condition found during a property inspection requires the appraiser to call for a professional inspection by a qualified specialist before value can be finalized?
Answer: Evidence of active wood-destroying insect infestation or structural damage
Active wood-destroying insect infestation or evidence of structural damage requires a specialist inspection because it affects the property's safety, soundness, and security under FHA MPR standards.
An appraiser managing a large FHA portfolio is asked by a lender to 'hit a value' to make a transaction work. What is the correct professional and regulatory response?
Answer: Decline to predetermine the value and complete the appraisal based solely on market evidence
Predetermined value conclusions violate USPAP's independence requirements and FHA appraiser independence standards, regardless of the requested amount.
What is the purpose of the FHA appraisal 'transfer' policy, and how does it affect portfolio management decisions?
Answer: It permits a lender to use an appraisal originally ordered by a different lender, reducing the need for a new appraisal
FHA's appraisal transfer policy allows a new lender to use a valid appraisal originally ordered by another lender, which affects how appraisers receive subsequent assignments on the same property.
For an FHA appraisal portfolio that includes manufactured housing, which valuation approach is given the most weight when sufficient market data exists?
Answer: Sales comparison approach using comparable manufactured home sales
The sales comparison approach is primary for FHA manufactured housing when adequate comparable sales are available, as it best reflects what buyers are actually paying in the market.
When reviewing completed FHA appraisals for a portfolio quality audit, which finding most strongly signals a systematic compliance problem requiring immediate remediation?
Answer: Use of MLS photographs in lieu of appraiser-taken photographs across multiple reports
FHA Handbook 4000.1 requires appraisers to take their own photographs; using MLS photos across multiple reports represents a systematic violation of FHA reporting standards that must be corrected.