On legacy Fannie Mae Form 1004 (March 2005), a supported+$5,000 garage adjustment is entered in the sales-comparison grid. How should it affect the feature entry and net total?
Correct Answer
C) Show the garage entry and include its signed amount once in Net Adjustment(Total)
On the specified legacy form, enter the supported garage adjustment on its feature line and include that signed amount once when computing Net Adjustment(Total). The total summarizes the feature entries; it is not a second $5,000 charge. Financing-concession or comments-only placement would not correctly classify the stated physical-feature difference.
Why This Is the Correct Answer
Option C is correct because the +$5,000 garage adjustment is entered on the Garage/Carport line and its signed amount is included once in Net Adjustment (Total). The total summarizes the feature entries rather than adding a separate charge.
Why the Other Options Are Wrong
Option A: Classify it as a financing concession on the sales grid
Option A, classifying it as a financing concession, mislabels a physical-feature difference. A garage difference is a characteristic of the property, not a term of the financing.
Option B: Enter it on the garage line but omit it from the net calculation
Option B, entering it on the garage line but omitting it from the net calculation, would leave the net total incomplete. The net total must include each feature adjustment entered in the grid.
Option D: Add $5,000 to the feature line and a separate extra $5,000 charge in the total
Option D, adding $5,000 to the feature line plus a separate extra $5,000 in the total, double counts the adjustment. The net total is the sum of the feature lines, so the $5,000 appears in it only once.
Enter once, count once
Each adjustment lives on its own feature line, and the net total just adds up those lines.
How to use: Use this when asked how a feature adjustment affects the grid total.
Exam Tip
The net total line does not add new adjustments; it only sums the lines above it.
Common Mistakes to Avoid
- -Double counting an adjustment in the net total
- -Leaving a feature adjustment out of the net total
- -Placing a physical adjustment on the financing concessions line
Concept Deep Dive
Analysis
This question tests how a single feature adjustment flows through the sales comparison grid on the legacy Form 1004. The adjustment belongs on the line for the feature it addresses, and the Net Adjustment (Total) is simply the signed sum of the feature-line entries.
Background Knowledge
On the legacy URAR sales comparison grid, each element of comparison has its own line, and the Net Adjustment (Total) line sums the signed feature adjustments. The adjusted sale price then equals the comparable's price plus that net total. Placing an adjustment on the correct line keeps the grid transparent for reviewers.
Real-World Application
An appraiser finds that a comparable has a smaller garage than the subject and market evidence supports +$5,000. The appraiser enters +$5,000 on the Garage/Carport line, and the Net Adjustment (Total) includes it once along with the other feature adjustments.
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