Question 92

An appraisal made by a certified appraiser is required when the buyer is using an FHA loan to purchase.

An appraisal is a critical component of the financing process for FHA loans, as it ensures that the property's value meets the loan requirements and protects both the lender and the borrower.

A) before real property can transfer from one owner to another.

While appraisals are often necessary in real estate transactions, they are not universally required before all property transfers. Other methods, such as title transfers without financing, may not necessitate an appraisal.

B) when heirs receive property.

Appraisals are not required when heirs receive property, as this process typically involves estate handling and may utilize assessed values rather than formal appraisals unless the property is to be sold or valued for tax purposes.

C) when the buyer is using an FHA loan to purchase.

This option is correct because FHA loans specifically require an appraisal by a certified appraiser to establish the property's market value and ensure it meets certain minimum standards for safety and livability.

D) before any property settlement in a divorce.

Although an appraisal may be useful during property settlement in a divorce, it is not a mandatory requirement. The division of assets can occur based on mutual agreement or other valuations that do not require a formal appraisal.

Conclusion

An appraisal is specifically mandated for FHA loans to ensure the property meets lending criteria, thus making option C the correct answer. Other options either misrepresent the necessity of an appraisal or apply to situations where an appraisal is not legally required.