Property Valuation
An appraiser making an 'as-is' appraisal of a Washington property values it at $340,000 as of the inspection date. This means:
AThe property will be worth $340,000 after recommended repairs are made
BThe property is worth $340,000 in its current condition on the date of inspection✓ Correct
CThe property should be listed for $340,000
DThe lender is required to lend up to $340,000
Explanation
An 'as-is' appraisal reflects the value of the property in its current condition as of the effective date of the appraisal, without any anticipated repairs or improvements.
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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.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
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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