Origination Activities 25-32

According to the passage, what is one of the most common ways appraisers value a home?

• By guessing the value

• By comparing properties to similar nearby homes

• By asking the homeowner

• By using the original purchase price

According to Fannie Mae, what should comps have in common with the home being appraised?

• The same owner

• Similar physical and legal characteristics, such as the number of rooms, site sizes, gross square footage, style, and condition

• The same color

• The same address

• somewhere near

• much lower than

• exactly the same as

• far above

Ava is in the process of closing a loan for her new home. Her lender must provide her with a written appraisal no later than three business days before the closing date, unless Ava decides to waive this right.

• True

• False

Fill in the blank: When Ava applied for a mortgage, she was informed that borrowers have the right to a copy of the appraisal regardless of whether the loan is ______ or denied.

• made

• approved

• processed

• reviewed

What is an appraisal?

• A biased assessment of a property's value

• An unbiased assessment of a property's market value performed by a qualified and trained professional

• A home inspection

• A list of repairs needed for a home

Either the lender or the borrower can choose the appraisal company or appraiser.

• True

• False

Fill in the blank: An appraisal seeks to determine the ______ of a home.

• value

• color

• location

• age

Aiden is buying his first home and is learning about the appraisal process. Which of the following is NOT true about appraisals?

• They are required for most home purchases

• The process must be completely unbiased

• The borrower can always choose the appraiser

• Lenders have a list of approved appraisers

Maya is buying her first home and wants to ensure everything is in good condition. What is the purpose of a home inspection compared to an appraisal?

• To determine the value of a home

• To uncover any needed repairs or defects with the home and the cost to fix them

• To approve the mortgage

• To select the appraiser