Term
| A real estate appraiser ___ value. |
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Definition
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Term
| Appraisals are based on ___. |
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Definition
| Type and difficulty of the appraisal. |
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Term
| What are the 4 elements of value? |
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Definition
Scarcity
Transferability
Utility
Demand |
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Definition
| If too much property is available, the value will be less. |
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Term
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Definition
| Must be able to transfer ownership from one party to another party. |
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Term
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Definition
| The property must be useful. |
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Term
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Definition
| There must be a demand for the property. |
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Term
| What 4 forces affect value? |
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Definition
Physical
Economy
Political
Social |
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Term
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Definition
| The highest price a property will bring. |
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Term
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Definition
| The actual price of the property at time of sale. |
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Term
| Competitive Market Analysis |
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Definition
| A report where marketplace data is gathered using comparable properties. |
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Term
| What are the 5 principles of value? |
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Definition
Substitution
Highest and best use
Supply and demand
Conformity
Contribution |
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Term
| The formula for the Cost Approach |
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Definition
| Value = Cost to Replace - Accrued Depreciation + Land |
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Term
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Definition
| How much it would cost to create an exact duplicate of an identical property. |
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Term
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Definition
| How much it would cost to build a similar property. |
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Term
| List and define 3 types of depreciation |
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Definition
Physical Depreciation - worn siding
Functional Obsolescence - dried up well
External Obsolescence - political upheaval |
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Term
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Definition
| The rate of return received on an investment. (Future Income) |
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Term
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Definition
| Assumes that the new income derived will control value. (Present Value) |
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Term
| Summarize the Appraisal Process |
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Definition
1. State the problem
2. Preliminary survey
3. Gather, record and verify data
4. Analyze and interpret data
5. Apply approaches to value
6. Reconcile/corolate data and estimate value |
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Term
| Real Estate Settlement Procedures Act (RESPA) |
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Definition
| A federal disclosure law involving closing costs and fees |
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Term
| RESPA requires lenders to disclose ___. |
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Definition
| Estimated and actual settlement costs. |
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Term
| A HUD booklet "Settlement Costs and You" and a good faith estimate of settlement costs must be given within ___. |
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Definition
| 3 days before loan application. |
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Term
| RESPA requires settlements to be prepared on ___. |
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Definition
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Term
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Definition
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Term
| When should the purchaser have access to the actual costs involved and when do they get a copy of the settlement statement? |
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Definition
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Term
| List all seller expenses paid at closing. |
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Definition
| Commission, deed preparation & stamps, existing liens & bank charges, satisfaction price, repairs agreed to & prorated expenses due. |
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Term
| List normal buyer expenses paid at closing. |
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Definition
| Title insurance, sales price, loan costs, attorney fees, credit report, appraisal, survey, insurances, recording fees, escrow deposits & reimbursement of prorated expenses. |
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Term
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Definition
| Items paid on closing date by lender, like taxes. |
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Term
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Definition
| Items that are reimbursed by either the buyer or seller, like HOA fees or utilities. |
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Term
| What is the purpose of closing? |
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Definition
| To ascertain that the title is marketable and insurable. |
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Term
| What is the purpose of the closing statement? |
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Definition
| To account for all cash received and disbursed on the day of closing. |
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