Property Valuation
In NC, a 'drive-by appraisal' using only exterior inspection and public records is most commonly used for:
ALuxury home purchases
BLow-risk refinances where sufficient data is available without an interior inspection✓ Correct
CAll commercial appraisals
DFirst-time buyer FHA loans
Explanation
Exterior-only (drive-by) appraisals are sometimes used for refinances with strong LTV ratios and extensive public data availability, where the reduced certainty is acceptable given the lower risk profile.
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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.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
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.
Math Concepts
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