Property Valuation
An appraiser completing a Massachusetts residential appraisal for a federally related transaction must hold at minimum a:
ATrainee appraiser license
BLicensed Residential Appraiser credential
CCertified Residential Appraiser credential✓ Correct
DCertified General Appraiser credential
Explanation
For federally related transactions involving 1-4 unit residential properties, the minimum credential required is Certified Residential Appraiser. The Licensed Residential credential may be used for non-complex residential properties under $1,000,000 in some circumstances.
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Key Terms to Know
Appraisal
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
Deed of TrustA security instrument used in many states instead of a mortgage, involving three parties: borrower (trustor), lender (beneficiary), and a neutral trustee.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
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