Tennessee Realtor State Practice Exam

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Prepare for the Tennessee Realtor State Exam. Use flashcards and multiple-choice questions, each with hints and explanations. Ensure your success!

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Who should obtain an appraisal of the property before closing if the transaction is being financed?

Seller
Buyer
Real Estate Agent
Lender

The correct answer is: Buyer

In a financed transaction, it is typically the lender who requires an appraisal of the property before closing. The purpose of this appraisal is to assess the property's market value to ensure that it meets the lender's requirements for the loan amount being provided. The lender will rely on this appraisal to mitigate risk, ensuring that they are not lending more than the property is worth. While the buyer may have a vested interest in understanding the property's value for their financial planning, it is the lender's responsibility to order and review the appraisal as part of the financing process. Therefore, the involvement and requirements of the lender are at the core of why an appraisal is necessary before closing.