Property Valuation
A 'drive-by' or 'exterior-only' appraisal of a Utah property is typically ordered when:
AThe appraiser is too busy to do a full inspection
BThe lender needs a limited appraisal for a low-risk refinance or when interior access is unavailable✓ Correct
CThe property is in a rural area inaccessible by standard vehicle
DThe buyer waives their appraisal right
Explanation
Exterior-only appraisals (Form 2055) are typically ordered for lower-risk lending situations, refinances with strong equity, or when interior access is not available. The appraiser evaluates the exterior condition and uses comparable sales but cannot comment on interior condition.
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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.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Math Concepts
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