How must an appraiser state the distance from the subject to each comparable on a Fannie Mae appraisal?
Correct Answer
A) In miles with a direction, measured in a straight line, such as “1.75 miles NW”
Fannie Mae requires the distance in miles with a directional indicator, measured in a straight line between the properties. Driving distance, travel time or vague descriptions do not meet the requirement.
Why This Is the Correct Answer
Option A is correct because Fannie Mae requires the appraiser to state the distance in miles with the applicable directional indicator, such as 1.75 miles NW. The distance is measured using a straight line between the subject and each comparable. This gives a consistent, specific description of proximity.
Why the Other Options Are Wrong
Option B: In driving miles along the shortest public road, with no direction given
Option B is wrong because driving miles along the shortest public road, with no direction given, does not meet the requirement. Fannie Mae calls for straight-line distance in miles plus a directional indicator.
Option C: As “nearby” or “same market area,” since exact distance is optional
Option C is wrong because vague terms like nearby or same market area are not acceptable, and exact distance is not optional. The appraiser must be specific about distance in miles and direction.
Option D: In minutes of typical drive time, measured at rush hour
Option D is wrong because minutes of typical drive time at rush hour is not a distance in miles. Fannie Mae requires straight-line miles with a directional indicator.
As the crow flies, with compass
Measure like a crow flies, in miles, and add the compass direction. 1.75 miles NW is the model.
How to use: Use this image when a question asks how comparable distance is reported on a Fannie Mae appraisal.
Exam Tip
Pick the option with both straight-line miles and a direction. Options missing either element, or using time instead of distance, are wrong.
Common Mistakes to Avoid
- -Reporting driving distance instead of straight-line distance
- -Leaving out the directional indicator
- -Using vague terms instead of a specific distance
Concept Deep Dive
Analysis
This question tests how Fannie Mae requires proximity of comparables to be reported. The distance must be stated in miles with a direction, measured in a straight line between the properties. Alternative measures such as driving distance or drive time do not meet the requirement.
Background Knowledge
Proximity helps readers judge whether a comparable is in the same competitive market as the subject. A standard measure, straight-line miles with direction, makes reports consistent and allows reviewers to locate comparables relative to the subject.
Real-World Application
An appraiser maps a comparable across a river that is a long drive away but only half a mile in a straight line. The report states the straight-line distance with its direction, and the appraiser comments separately if the river affects market appeal.
More Sales Comparison Questions
Supported adjustments are: non-market financing $10,000, GLA $36/sf, garage $3,500 per car, pool/spa $12,500. A comparable identical to the 2,800 sf subject sold for $267,000 with non-market financing. What is its adjusted price?
Using GLA $36/sf and non-market financing $10,000: a 3,100 sf comparable sold for $277,000 with non-market financing; the subject has 2,800 sf. Bath count differences are not adjusted. What is the adjusted price?
Using garage $3,500 per car and pool/spa $12,500: a comparable with a 2-car garage and a pool/spa sold for $268,000. The subject has a 3-car garage and no pool. What is the adjusted price?
Using GLA $36/sf, garage $3,500 per car and pool/spa $12,500: a 2,600 sf comparable with a 2-car garage and a pool/spa sold for $264,000. The subject is 2,800 sf with a 3-car garage and no pool. What is the adjusted price?
In a neighborhood with declining values and marketing times over six months, what must Fannie Mae lenders confirm about the sales comparison analysis?
A house is a 4,000 square foot home in an area of 2,000 square foot homes. How must the appraiser treat this over-improvement in the sales comparison grid?
According to the Interagency Appraisal and Evaluation Guidelines, which items should an appraisal’s market conditions discussion include?
A comparable listed at $420,000 and sold for $399,000. What sale-to-list price ratio (sale price ÷ list price) does this indicate?
An appraiser wants to describe the neighborhood boundaries in a Fannie Mae report. Which approach is acceptable?
Which of these is listed by Fannie Mae as a sales or financing concession?
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