An appraisal conducted for a federally related loan transaction must be performed by a:
Why State-certified or state-licensed appraiser Is Correct
Answer B: State-certified or state-licensed appraiser
Exam Tip: Property Valuation
Valuation questions focus on the three approaches to value: sales comparison, cost, and income. Know which approach is best for which property type. The income approach uses cap rate and NOI — memorize these formulas.
Key Property Valuation Terms in This Question
People Also Study
Related Alabama Questions
- In Alabama, an appraisal for a federally related transaction (such as an FHA or conventional bank loan) must be performed by:Property Valuation
- Alabama regulations require brokers to maintain trust account records for at least:Trust Funds
- When an appraiser completes an appraisal in Alabama, the report is addressed to the:Property Valuation
- Subdivision regulations in Alabama typically require a developer to:Land Use & Zoning
- The Alabama License Law requires that all real estate transactions be conducted:Alabama License Law
- Alabama regulations require a broker to maintain their trust account in a financial institution located in:Trust Funds
- When using the sales comparison approach to value a property in Alabama, the appraiser:Property Valuation
- An Alabama appraiser uses the income approach to value a rental property. The key formula is:Property Valuation
Key Terms to Know
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
Net Operating Income (NOI)The annual income generated by an income-producing property after subtracting operating expenses, but before debt service.
State-Specific Concepts
Study This Topic
Practice More Alabama Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Alabama Quiz →