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97 Multiple choice questions

  1. Commonly known as liens or security interests.
  2. Large / more luxurious house in a less upscale neighborhood is worth less.
  3. The Management Section
  4. Go through the Designated Broker !!
  5. Appraiser accounts for future use of property. The value is created by buyer's expectation about future benefits of ownership.
  6. Carpet, Tile, Insulation are forms.

    Views are NOT specific to the building.
  7. Cost Approach
    Sales Comparison
    Income Approach
  8. Affect the use of real estate.

    1- easements -- non-exclusive right to use someone's property for a purpose.
    2- profits -- right to take something from someone's property (gravel)
    3- private restrictions -- deed restrictions or CCRs that run with the land.
  9. Adhere to State and Federal regulations
  10. Must contain sufficient information in appraisals.
  11. Most detailed & reliable method for estimating construction cost. Each construction component is estimated separately. Example - costing out lumber, labor, all materials etc.
  12. Land described by reference to officially recorded play map that shows boundaries of parcels.
  13. How social forces affects the value:
    1 - social
    2 - economic
    3 - governmental
    4 - environmental
  14. Principle of Substitution
  15. Seller financing with market interest rate.
  16. 1) Utility - Must satisfy a want or need
    2) Scarcity - Not Overabundant
    3) Desire - Potential Purchasers
    4) Effective Purchasing Power - Ability to pay for it
  17. Landlord
  18. Tenant (leasehold)
  19. Independent Fee Appraisers - hired by many clients
    Government Agency Appraisers
    Staff Appraisers - i.e. For a business
  20. Reference points, courses and boundaries
  21. Landlord agrees to allow tenant to stay for an indefinite period ... With no written lease in place.
  22. Items installed by tenants in the course of a business are considered property of tenant.
  23. British Thermal Unit -- Furnace and Air-condition Ratings
  24. Final Step in an appraisal --- Taking all of the appraisal data to come up with the value.
  25. Reflects the effects of local social, economic, governmental and physical forces on value.
  26. Estimating the land value for an improvement property
  27. Must have a Brokers or Associated Brokers license to render a BPO.
  28. Terminate on death of a specified person.
  29. Reconciliation
  30. 2 different CORE classes
    12 Elective hours

    Renewing Active - 1st time:
    1 - 8 hr Fundamentals
    1 - 4 hr Pricing, Marketing
    1 - 4 hr Professional, Closing
    1 - 4 hr Commercial

    Exams expire in 1 year
    Fingerprints expire in 6 months
  31. 1) Physical - Wear & Tear - Can be curable or incurable
    2) Functional Obsolescence - Design Defects, needs updating
    3) External Obsolescence - Economic or Locational - Normally considered incurable.
  32. Smaller sections (in the NW 1/4's) because they are where the correction lines are ... Or smaller because of boundaries of water.
  33. Substitution (PG 260 RE Appraisal)
  34. Appraisers have to come up with a single dollar amount as opposed to a range of values on their appraisals.
  35. Federal Financial Institutions Regulatory Agencies
  36. 1- Monolithic Slab
    2- Foundation Wall
    3- Pier and Beam
  37. All things equal between two properties, Buyer will purchase lower price property
  38. Replacement Cost of Improvements
    [-] depreciation of improvements
    [+] value of land

    Equals Property Value
  39. A type of Freehold Estate. (Possessory Interest)
  40. Fannie Mae
    Freddie Mac
    Ginnie Mae
  41. 1 - Identify property characteristics that affect value;
    2 - Identify economic and social trends that affect value;
    3 - Provide context for analysis of local value influences.
  42. U - Utility
    S - Scarcity
    E - Effective Purchase Power
    D - Desire
  43. Finding comps that are superior to adjust value downward AND finding comps that are inferior to adjust value upward. Shows top and bottom of market.
  44. The Date of INSPECTION (Market conditions change daily so appraisal is subject to time of inspection)
  45. A property's value is determined by most profitable use available.

    It must meet 4 criteria:
    1. Physically possible
    2. Legally permissible
    3. Financially feasible
    4. Maximally productive
  46. Tenant remains in the property without consent.
  47. Replace equal utility of building or structure
  48. Property is described in relation to a rectangular grid that has been established by federal government survey.

    Established in 1785.
  49. Small / poorly constructed house is located in an upscale neighborhood makes it worth more.
  50. The most reliable and best way to determine estimated depreciation due to external causes. Environmental Obsolescence.
  51. Uniform Standards of Professional Appraisal Practices - was established after the Savings and Loan Crisis of 1980s
  52. 1- Deferred Maintenance
    2- Functional Obsolescence
    3- Environmental Obsolescence
  53. Federal Deposit Insurance Corporation
  54. A Form of Freehold Estate that includes the entire bundle of rights of ownership.
  55. 1- Exposed on open market
    2- Not related
  56. Land and building owned by Corporation. Each shareholder has proprietary leases.
  57. 1 - Regional and Community Data;
    2 - Market and Neighborhood Data;
    3 - Site Data;
    4 - Data about buildings or improvements.
  58. Increasing Value -- Merger of two or more lots to create area for more profitable use.
  59. Decks, sheds, shops ...
  60. Creating exact replica of building or structure
  61. Appraisal Qualifications Board
  62. Lasts for any fixed term.
  63. Management.
  64. The most reliable approach to value.
  65. Placement of Windows and Openings on wall
  66. Benefits an organization/individual rather than a parcel of land. (i.e. a utility company). There is a servient estate, but NO dominant estate.
  67. Work for many different appraisers. Independent / self employed.
  68. Price increases ...
  69. Lease expires ... And tenant remains on a month-to-month agreement until a new lease is signed.
  70. Off-site Improvements
  71. Method to value Land when data for comparable sales of vacant land isn't available
  72. Story of an appraisal and how appraiser reached the final opinion of value. ALWAYS includes a "Letter of Transmittal" with it. (A cover letter - cannot be misleading)
  73. Wide concrete pads (footings) that support the house weight.
  74. Utilities -- because it represents building data.
  75. Only adhere to State Regulations
  76. Steps in installing drywall.
  77. The most reliable method to establish cap rate.
  78. C - Capital (financial resources)
    L - Land (natural resources)
    C - Coordination (management / entrepreneurship)
    L - Labor (availability of workforce)
  79. No permission to be there. Period is over and they have no right to be there.
  80. Market Theory of Value
  81. Lease automatically renews itself at end of period until notice to terminate. (Month-to-month, example)
  82. 1) Arm Length Transaction - (Not a family member etc)
    2) No Undue Stimulus - (Concessions to Buyer etc)
    3) Informed, Knowledgeable Parties -
    4) Property on Market a Reasonable Amount of Time -
  83. FNMA - Fannie Mae
  84. Value with improvement equals value it adds to property
  85. 1. Define the Appraisal Problem
    2. Determine the scope of the work
    3. Collecting and verifying the data
    4. Analyzing the data
    5. Valuing the Site
    6. Applying the Three Approaches to Value
    7. Reconciling the Value
    8. Reporting the Value Estimate
  86. Value of property is affected by the potential future benefit (PG 192 RE Appraisals)
  87. All collected data must be verified. Some forms are:
    1 - Interview with owners of comparable property to verify terms of sale;
    2 - Reviewing county records to validate the date and selling price;
    3 - Personal Inspection to verify dimensions.
  88. Building insulation.
  89. Always incurable --- value is lost because of outside property factors.
  90. Excessive in quality or design - "Over Building"
  91. Potential gross income minus debt for vacancies and bad debts only.
  92. The most reliable appraisal approach for office buildings.
  93. A right to use someone else's air, water, property ... By easement.
  94. A statistic that tracks the relative change in construction cost over time
  95. No agreement memorialized, no term, no date, period.
  96. Specific Term --- can just be a few months
  97. Land not need for the "Highest and Best Use" of a site