### What does an appraisal report primarily estimate? - [ ] The insurance value of the property - [x] The market value of the property - [ ] The tax value of the property - [ ] The replacement cost of the property > **Explanation:** An appraisal report is used to estimate the market value of a home by examining both its interior and exterior. The appraiser provides a detailed description and compares it with recently sold similar properties in the area. ### Who typically pays for the appraisal report? - [ ] The lender - [x] The borrower - [ ] The real estate agent - [ ] The appraiser > **Explanation:** Borrowers usually pay for the appraisal report at the closing and are entitled to a copy of it. This cost is often included in the closing costs when financing the purchase of a property. ### What is the common form used for appraisal reports? - [ ] Home Value Estimate Report - [ ] Real Estate Comparative Analysis Report - [x] Uniform Residential Appraisal Report - [ ] Mortgage Assessment Form > **Explanation:** The most common form used for appraisal reports is the Uniform Residential Appraisal Report, which provides a standardized way of reporting property values and conditions. ### Why does a lender require an appraisal report? - [ ] To increase the loan amount - [ ] To negotiate loan terms - [x] To ensure the loan amount does not exceed the property's value - [ ] To assess the property's tax rate > **Explanation:** A lender requires an appraisal report to make sure that the loan amount does not exceed the property's market value. Since the property serves as collateral for the loan, the lender needs to confirm its worth to protect their investment. ### What additional information can be found in an appraisal report? - [x] Photos and value of improvements made after the home was built - [ ] Only the square footage of the property - [ ] Only the age of the property - [ ] Only the neighborhood amenities > **Explanation:** In addition to the property description, an appraisal report includes photos and the value of improvements made after the home was built. This information helps in establishing an accurate market value for the property. ### Who usually performs the appraisal for an appraisal report? - [ ] The real estate agent - [ ] The homeowner - [x] A qualified appraiser chosen by the lender - [ ] The loan officer > **Explanation:** Appraisal reports are conducted by qualified appraisers who are generally chosen by the lender. Their role is to provide an unbiased estimate of the property's market value. ### Can the borrower see a copy of the appraisal report? - [x] Yes - [ ] No - [ ] Only if the lender allows it - [ ] Only after one year of loan payment > **Explanation:** Borrowers are entitled to a copy of the appraisal report. This ensures that the borrower is also aware of the property's assessed value. ### What type of properties are compared in an appraisal report? - [ ] Recently renovated properties - [ ] Foreclosed properties - [x] Recently sold comparable properties in the area - [ ] Properties listed for sale > **Explanation:** Appraisal reports include the values of recently sold comparable properties in the area, which help in gauging an accurate market value of the home being appraised. ### What happens if an appraisal report values a home less than the desired loan amount? - [ ] Borrowers can get the higher loan amount anyway - [ ] The loan application is automatically rejected - [x] The lender may not offer a mortgage exceeding the appraised value - [ ] The seller must reduce the property's price > **Explanation:** If an appraisal report values a home less than the desired loan amount, the lender may not offer a mortgage exceeding the appraisal value, since the home is the collateral for the loan and exceeding that value constitutes too much risk for the lender. ### What is the main role of the appraiser in preparing an appraisal report? - [ ] To set the lending terms for the mortgage - [x] To provide an unbiased estimate of the property's market value - [ ] To determine the property's tax rating - [ ] To evaluate the property's insurance needs > **Explanation:** The main role of the appraiser is to provide an unbiased estimate of the property's market value by thoroughly assessing both the interior and exterior, as well as comparing it with similar properties that have recently sold in the area.