Valuations for Lending Purposes

Single-Family Uniform Residential Appraisal Report (Form 1004)

This is the most commonly used report, known within the industry as the URAR, and is completed on FNMA form 1004.  This appraisal report requires a full interior & exterior inspection of the subject property.  The URAR report includes many supporting photos, documents, and calculations supporting the appraisers value opinion.  Report exhibits include subject and comparable photos, floor plan sketch gross living area calculations, location map indicating proximity of comps to the subject, as well as relevant certifications and limiting conditions.

Non-Owner Occupied, Single-Family URAR (Forms 1004,  1007, 216)

This report format is typically requested by lenders when financing single family rental homes.   The inspection, reporting, and supplemental documents are similar in all respects to the standard Single-Family Uniform Residential Appraisal Report with the following additions: A completed Single Family Rent Schedule (form 1007) and an Operating Income Statement (form 216).

Manufactured Home Appraisal (Form 1004C)

Manufactured home appraisals are reported on FNMA form 1004C.  Form 1004C requires the appraiser to complete a full interior & exterior inspection of the subject property, report neighborhood boundaries & characteristics, analyze market trends, consider site characteristics, complete cost approach, and report a variety of details of the manufactured home from the HUD date plate and certification label(s).

FHA/USDA Single Family Residential Appraisal (Form 1004)

FHA/USDA compliant appraisals are requested when lenders are making loan to be secured by the Federal Housing Administration or US Dept of Agriculture. The form and supplemental attachments are similar to a typical single family URAR while the inspection and reporting comments are slightly more extensive than for purposes of a conventional loan.  There is an additional mandate from FHA/USDA for the appraiser to pay specific attention to certain property conditions they feel are potentially hazardous to the health and/or safety of the occupants.

Condominium Appraisal (Form 1073)

Condominium appraisals completed for conventional and FHA loans are reported on the Individual Condominium Unit Appraisal Report (Form 1073) and comply with USPAP, and any client specific guidelines.  A full interior and exterior inspection of the subject unit is made and a summary analysis of the condo project and market are provided.  Attachments comparable to those included with the single-family residential report are also included in the condominium report.

2-4 Unit Residential Appraisal (Form 1025)

Appraisals of two-to-four unit residential properties are reported on the Small Residential Income Property Appraisal Report. This report provides an income analysis based on comparable rental properties, cost approach, and the sales comparison analysis. Included in the attachments is a completed operating income statement (Form 216).  Report exhibits include photographs of subject & comparables, location map, floor-plan sketch with exterior dimensions and gross living area calculations for each unit and appropriate certifications and limiting conditions.

Exterior-Only Appraisal Report (Form 2055)

The exterior-only appraisal is a USPAP compliant appraisal report that is based on an exterior-only inspection of a single family residence.  Use of this form generally results in a less reliable estimate when compared to a full interior & exterior valuation although is a more cost effective valuation appropriate for lower risk loans.  The report includes the appropriate approaches to value, photos of exterior of subject property and comparables, location map showing proximity of comparables to the subject property, as well as appropriate certifications and limiting conditions.

Desktop Underwriter Property Inspection Report (Form 2075)

Exterior-only property inspection reports are reported on form 2075 and should be considered an evaluation of the property’s marketability rather than its valuation.  This form is used by lenders as a brief analysis of current market conditions within the neighborhood, as well as summary reporting on the observed condition of the subject site and improvements.  No estimate of value is provided by the appraiser.

Single Family Rent Schedule (Form 1007)

The single family rent schedule is used to estimate market rent by the appraiser.  Typically the appraiser analyzes three rental properties that share or bracket significant rental characteristics with the subject property.  Form 1007 is commonly requested by lenders when loans are being made on non-owner occupied properties.

Operating Income Statement (Form 216)

The operating income statement is used by appraisers to estimate net income when appraising one-to-four unit investment properties.  Form 216 deducts common expenses including vacancy loss estimates from gross income to establish an estimate of net income.

Summary Appraisal Update Report and/or Certificate of Completion (Form 1004D)

Form 1004D is used for two entirely different purposes:  (1) The top portion of the form, the Summary Appraisal Update Report, may be used in certain circumstances to extend the ‘life’ of an appraisal from 120 to 180 days.   After a visual exterior inspection of the subject property, the appraiser must either indicate whether or not the value of the property has decreased since its original valuation and include any supporting photos/documentation. (2) The lower portion of the form is a Certificate of Completion and is used to indicate the status of “subject to” requirements.  This form is normally ordered by lenders after all appraisal-required repairs are complete or construction of a new home is fully complete.

One-Unit Residential Appraisal Field Review Report (Form 2000)

The Residential Appraisal Review Report (Form 2000) is a four page form used by an appraiser to professionally review the work of another appraiser.  A review appraiser uses this form to address the accuracy of the data in the appraisal report being reviewed and to develop an opinion of the appropriateness of the appraisal methods and techniques that the original appraiser used.  The completed Form 2000 report includes photos of exterior of subject and comparables, location map, any alternate comparables appropriate, as well as USPAP certifications and limiting conditions

Two-to-Four Unit Residential Appraisal Field Review Report (Form 2000A)

The Residential Appraisal Review Report (Form 2000A) is a five page form used to review a 2 to 4 unit property.  A review appraiser uses this form to address the accuracy of the data in the appraisal report being reviewed and to develop an opinion on the appropriateness of the appraisal methods and techniques that the original appraiser used.  Inspection, research, and reporting requirements of Form 2000A are similar to those for Form 2000.

Desk Review (Form 2006)

Desk Appraisal Reviews reported on Form 2006 are commonly requested by lenders for both pre-funding and post-funding audits. The appraisal under review is analyzed to determine the logic and reasoning displayed in support of the value estimate and the appraisal report’s compliance with USPAP. Confirmation of the data utilized in the report is made from a variety of publicly available sources. Any additional data considered by the reviewer is subsequently reported within the body of the completed review.

Automated Valuation Model (AVM)

An AVM is artificial intelligence estimate of value.  The accuracy of AVM’s vary considerably based on the availability of data in a specific market, the complexity of property being appraised, and the completeness of county records.

Residential Evaluation

Evaluations are prepared by real estate brokers rather than licensed appraisers and are used in specific instances by lenders for portfolio management and for lower limit loans.

 

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