Under Fannie Mae's Selling Guide, a lender engages an appraiser to perform a property data collection on a home. Two weeks later, the same lender engages that appraiser to complete the appraisal using that data collection. How is the appraisal classified?
Correct Answer
D) As a hybrid appraisal, even though the same person performed both assignments
Fannie Mae treats property data collection and the appraisal report as separate assignments that may be performed by different people, and states that an appraiser engaged first as a property data collector and later as the appraiser is still performing a hybrid appraisal. The appraiser's earlier visit does not make it a traditional appraisal, the data collection means it is not a desktop, and nothing bars one person from doing both assignments.
Why This Is the Correct Answer
Option D is correct because the Selling Guide states that when an appraiser is engaged as a property data collector and later engaged as the appraiser, the work is still considered a hybrid appraisal. Data collection and appraisal are separate assignments that may, but need not, be performed by different people.
Why the Other Options Are Wrong
Option A: As a traditional appraisal, because the appraiser personally visited the property
Option A is wrong because the appraiser's earlier visit was made in a separate property data collection assignment. Fannie Mae classifies this sequence as a hybrid appraisal, not a traditional appraisal.
Option B: As a desktop appraisal, because no inspection occurred during the appraisal assignment
Option B is wrong because a desktop appraisal relies on alternative data sources without a property data collection. Here a property data collection was performed and used, which is the defining feature of a hybrid.
Option C: As a property data collection, since one person may not perform both assignments
Option C is wrong because nothing in the hybrid rules prevents one person from doing both assignments. The Selling Guide says the two assignments may be performed by different people, not that they must be.
Two assignments, one hybrid
Collection and appraisal are two separate jobs; whether one person or two people do them, the result is a hybrid.
How to use: Use this when a question asks how to classify an appraisal where the appraiser also collected the property data.
Exam Tip
Watch for answer choices that reclassify a hybrid because of who collected the data; the classification follows the two-assignment structure.
Common Mistakes to Avoid
- -Treating any appraiser visit to the property as a traditional appraisal
- -Believing the data collector and the appraiser must be different people
- -Confusing a hybrid appraisal with a desktop appraisal
Concept Deep Dive
Analysis
This question tests who may collect property data for a hybrid and how the assignment is classified when the collector and the appraiser are the same person. The candidate must resist reasoning that a personal visit turns the work into a traditional appraisal, and recognize that the separate-assignment structure is what defines the hybrid.
Background Knowledge
A hybrid appraisal relies on an interior and exterior property data collection by a trained and vetted third party, such as a real estate agent, insurance inspector or appraiser. The appraiser then uses that data with other sources to develop the appraisal reported on Form 1004 Hybrid or Form 1073 Hybrid.
Real-World Application
A lender hires a local appraiser to collect property data on a condo for a possible value acceptance + property data loan. When the loan later needs an appraisal, the lender engages the same appraiser, who completes Form 1073 Hybrid using the earlier collection.
More Emerging Methods Questions
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