USPAP Exam Questions and Answers: A Guide for Appraisers, Exams of Nursing

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Financial chaos began in the US during the - CORRECT ANSWER 1929 stock market crash after the great depression In the 1950s-70s double continued with - CORRECT ANSWER - Works related areas

• Property taxation
• Federal housing programs 1990s trouble was because of... - CORRECT ANSWER Mortgage scams and illegal house flipping. When an appraiser uses a hypothetical condition in an appraisal, USPAP requires the appraiser to: - CORRECT ANSWER Clearly and conspicuously state the use of the hypothetical condition in the report Which term is defined as an assignment condition established by applicable law or regulation, which precludes an appraiser from complying with a part of USPAP? - CORRECT ANSWER Jurisdictional exception Which of these actions would be considered significant appraisal assistance when performed by an appraiser? - CORRECT ANSWER Research and selection of comparable sales An appraiser develops a value opinion on a single-unit dwelling and does not develop the income approach. In the Appraisal Report prepared for the assignment, the appraiser: - CORRECT ANSWER Must state the reason for excluding the income approach According to USPAP, what is the primary reason for inspecting a property that is the subject of an appraisal? - CORRECT ANSWER To gather information about the characteristics of a property that are relevant to its value

Robert agrees to appraise a split-level home in a town 100 miles south of his office. While he is not generally familiar with that area, Robert rationalizes: "I have appraised houses like this one for 20 years. How hard could it be?" When Robert pulls up to the house, he notices the subject is in a gated community. Robert had never appraised a property in a gated community. As Robert inspected the interior of the subject he noted several items and finishes with which he was not familiar: marble floor coverings; upscale, built-in freezers; and a wine cellar. As Robert exits the back door, he notices the subject property fronts on a river. While this river does not connect directly with the ocean, it does connect with a network of streams that do, ultimately lead to the ocean. Robert is quite concerned. He has had no experience appraising a house with some of the features he has seen; and he has never appraised wat - CORRECT ANSWER Robert should contact the client as soon as possible and explain that he lacks the knowledge and experience to complete the assignment competently. If he feels he can obtain the required level of competency, and the client allows him, then Robert may proceed with the assignment. The SCOPE OF WORK RULE states that an appraisal or appraisal review report must contain sufficient information so that: - CORRECT ANSWER The client and other intended users understand the scope of work performed by the appraiser You have reviewed the appraisal of a house in a suburban area that was performed for an estate. The effective date was the date of inspection. You note in your review report that the proper effective date should have been the date of death of the deceased, and submit the review to your client. Two weeks later the client calls you. They thank you for the review, and note that they cannot reach the original appraiser. They need the appraisal very soon, and ask that, as part of the review process, you alter the appraisal report under review to change the effective date, and then sign the report certification. What should you do? - CORRECT ANSWER Do not sign the report, and explain that the review process is separate and distinct from the appraisal under review

If an appraiser has agreed with a client to keep the existence of an assignment confidential, how long must the appraiser wait before agreeing to perform another assignment on the same property? - CORRECT ANSWER Three years A trainee appraiser provides significant appraisal assistance to a senior appraiser. The trainee appraiser does not sign the certification, but instead the trainee appraiser's name is listed in the certification as having provided significant assistance. What else is the senior appraiser required to do in order to meet USPAP requirements for disclosing significant appraisal assistance in an Appraisal Report? - CORRECT ANSWER Summarize the extent of the assistance somewhere in the report An individual is both a real estate appraiser and a kitchen designer. He has been asked to appraise a property in which he designed the kitchen one year ago. Regarding this situation, which statement is TRUE? - CORRECT ANSWER The kitchen design service performed on the property must be disclosed. You are a certified residential appraiser, and are working with a supervising certified general appraiser on an industrial appraisal. Your supervisor is a certified general appraiser with 25 years' experience appraising shopping centers, industrial facilities, and office buildings. You and the supervisor sign the commercial reports you have been working on. While inspecting the subject property you note a patch of blackened grass behind the building. The black patch is near some overturned, open barrels. You made detailed notes and took several photos. Your report has a detailed section about your concerns.Your supervisor is concerned about your report. She told you the client, a major bank, would not be happy about a report that details dying grass. The supervisor tells you to remove that section of the report.You have trepidations, but your supervisor threatened not to work with you anymore unless you "remove t - CORRECT ANSWER Do not sign the report because deleting the section about possible contamination will create a misleading report

A client makes several requests of an appraiser who is completing an appraisal assignment. Which of these client requests is an assignment condition as defined by USPAP? - CORRECT ANSWER The appraiser must, at minimum, develop the sales comparison and the cost approach Which entity has final authority over USPAP and any changes to USPAP? - CORRECT ANSWER The Appraisal Standards Board Which statement is TRUE about the effective date of an appraisal? - CORRECT ANSWER It establishes the context of the value opinion. In order for an appraiser to use a hypothetical condition in the development of an appraisal, USPAP requires which of the following conditions to be met? - CORRECT ANSWER The use of the hypothetical condition must result in a credible analysis Which of these would be an assignment result in a residential appraisal assignment? - CORRECT ANSWER Site value An appraiser does not use the cost approach in the appraisal of a 100- year-old duplex dwelling. What must the appraiser include in the Appraisal Report prepared for the assignment, with regard to the exclusion of the cost approach? - CORRECT ANSWER A statement of the reason for excluding the approach An appraiser has agreed to perform an appraisal on a small residential income property. The appraiser analyzes the assignment elements and establishes a planned scope of work. Once established, the appraiser's scope of work - CORRECT ANSWER Is flexible and can change as needed in the course of the assignment An individual is both an appraiser and a real estate broker. What are the USPAP obligations for this individual when performing valuation services outside of appraisal practice? - CORRECT ANSWER The individual is required not to misrepresent his or her role in performing this service

Anne, a real property appraiser, recently completed an appraisal assignment for a lender-client of a residential property for a refinance transaction. The property owner just called Anne to inquire about the appraised value. Which is a true statement? - CORRECT ANSWER Anne must obtain consent from the lender prior to disclosing the appraised value. Two appraisers, from different firms, work together on an appraisal assignment and produce a written Appraisal Report. Both appraisers sign the letter of transmittal. Which statement is TRUE regarding their certification requirements? - CORRECT ANSWER Both appraisers must sign a certification. A Restricted Appraisal Report must include: - CORRECT ANSWER A warning that the report may not contain supporting rationale for all of the opinions and conclusions set forth in the report Which entity sets the minimum standards for licensing and certification of appraisers which the states are required to adopt? - CORRECT ANSWER The Appraiser Qualifications Board Jack appraised a residential dwelling located across the street from a factory that he determined is negatively affecting the value of the subject property. However, when offering the assignment, the client asked that the factory not be discussed in the appraisal report. Jack applied a location adjustment in his sales comparison approach on the comp grid but included no further discussion about the location adjustment, or the factory, in the appraisal report. Has he complied with USPAP? - CORRECT ANSWER No, omitting the discussion could produce a misleading report. A lender has contacted an appraiser to determine the high and low sale prices in the past year that took place in the Green Hills Subdivision. No mention was made of a subject property by the lender. The appraiser supplied a list of all sales within the past year in the subdivision and billed the lender for service. The service being provided by the appraiser is - CORRECT ANSWER Appraisal practice with no performance standards or record keeping requirements

An appraiser is performing an appraisal review on an appraisal report that was prepared by another appraiser. The appraiser is permitted by USPAP to do all of the following EXCEPT: - CORRECT ANSWER Use data that became available after the date of the original appraisal to form an opinion of the quality of the appraiser's work In an appraisal assignment, what does the effective date establish? - CORRECT ANSWER Whether the opinion is current, retrospective, or prospective Which of the following statements about the scope of work is TRUE? - CORRECT ANSWER Appraisers have flexibility as well as responsibility in determining the scope of work. An appraiser is valuing a residential property for a mortgage loan and is reporting the results in an Appraisal Report. The appraiser is aware that there is another intended user in addition to the client. This intended user is a secondary mortgage market participant who will be purchasing the loan, but the appraiser does not know the name of this intended user. What is the best course of action for the appraiser to comply with USPAP? - CORRECT ANSWER Identify the intended user by type in the report. An appraiser has developed an appraisal on a parcel of vacant land and provides an oral report of the assignment results. In providing this oral report, to the extent possible, the appraiser must: - CORRECT ANSWER Meet the content requirements of an Appraisal Report At a minimum, how long must an appraiser retain records for completed appraisal assignments that involved no litigation or judicial proceeding? - CORRECT ANSWER 5 years USPAP requires the appraiser to reconcile - CORRECT ANSWER Both the results of the different approaches to value and the data and analysis used in each approach

Is an appraiser permitted by USPAP to use a hypothetical condition in an appraisal review assignment? - CORRECT ANSWER Yes, as long as the appropriate conditions are met An attorney contacted a real property appraiser regarding a potential assignment. The attorney is acting as an agent for his client, who would be the client in the appraisal assignment and wishes to remain anonymous. The attorney is not certain in what manner the appraisal will be used. How should the appraiser treat this request? - CORRECT ANSWER The appraiser cannot agree to perform the assignment without knowledge of the identity of the client or the intended use. An appraiser's client asks the appraiser to provide an opinion of the amount of time the subject property would have been on the market prior to the hypothetical consummation of a sale at market value on the effective date of the appraisal. What is this client requesting - CORRECT ANSWER Exposure time What is the stated purpose of USPAP? - CORRECT ANSWER Promote and maintain the public trust USPAP compliance is required of: - CORRECT ANSWER Appraisers required by law, regulation, agreement or choice to be USPAP compliant Which of the following is not a requirement of a written Appraisal Report, prepared in compliance with USPAP? - CORRECT ANSWER It must contain a copy of the deed or other type of legal description An appraiser is preparing an Appraisal Report on a residential property using a pre-printed report form created by the client. There is no space on the form for the appraiser to provide a summary of the analysis of prior sales of the subject that occurred within the prior three years. What should the appraiser do? - CORRECT ANSWER Supplement the form with this information, using an addendum if necessary An appraiser receives a request for an appraisal assignment for a property that the appraiser had previously appraised 20 months ago.

The appraiser understands that they must handle confidential information appropriately. What else must the appraiser do? - CORRECT ANSWER Make proper disclosure regarding the prior assignment In an appraisal of a multi-family residence, which of these would NOT be an assignment result? - CORRECT ANSWER Building measurements An appraiser does not possess the knowledge and experience to perform an assignment, but wishes to perform the assignment anyway. Which action would NOT be required by USPAP? - CORRECT ANSWER Inform the client after the report has been delivered about the initial lack of competency and the steps that were taken to complete it competently. According to USPAP, a/an _________ analysis is the study of the cost- benefit relationship of an economic endeavor. - CORRECT ANSWER Feasibility An appraiser is valuing a residential property that is currently offered for sale and not yet under contract. The appraiser analyzes the subject's current listing and includes this wording in the report, "The subject is currently offered for sale for $499,900 and has been on the market for 60 days." Is this acceptable under USPAP reporting standards? - CORRECT ANSWER No, because this is a statement of facts, and provides no summary of the appraiser's analysis STANDARD 2 of USPAP establishes ___________ requirements for appraisal report content. - CORRECT ANSWER Minimum A client engages an appraiser to complete an appraisal on a residential property; the appraiser develops a value opinion and transmits the report to the client. Three years later, the client files a complaint against the appraiser with the state appraiser regulatory agency. The agency contacts the appraiser and requests the appraiser make the assignment workfile available to the agency. The appraiser is concerned about confidentiality. Under USPAP, may the appraiser refuse to provide workfile access to the state regulatory agency? - CORRECT ANSWER No, the RECORD KEEPING RULE requires the

appraiser to make the workfile available to the state appraiser regulatory agency Which federal government entity oversees the activities of The Appraisal Foundation? - CORRECT ANSWER Appraisal Subcommittee The activities of the Appraisal Subcommittee are funded by: - CORRECT ANSWER The collection of registry fees from state licensed and certified appraisers An appraiser has been asked to complete an appraisal on a property without making an inspection of it. The appraiser is unable to obtain sufficient information about the subject property's relevant characteristics, and is unable to modify the assignment conditions to include gathering the information or use an extraordinary assumption about the information. Which statement is TRUE regarding this situation? - CORRECT ANSWER The appraiser must withdraw from the assignment. An appraiser is engaged to appraise a residence that fronts a two-lane residential street. It is public knowledge that the City Council recently voted to widen the street to four lanes next year. However, the appraiser was not familiar with the City's proposal and therefore did not consider the effects of the street widening in the appraisal. Has the appraiser violated the COMPETENCY RULE? - CORRECT ANSWER Yes, the appraiser did not consider the relevant characteristic. The market will react today to this change in the future and the appraiser should consider this reaction and note its effect on value If an appraiser has a present or prospective interest in a property, may that appraiser perform and report an appraisal and not violate USPAP - CORRECT ANSWER Yes, as long as the appraiser discloses the interest in the certification An appraiser has been engaged to perform an appraisal assignment on a residential property and prepare an Appraisal Report. Several days after the appraiser begins to work on the assignment, the client changes their mind and decides they want a Restricted Appraisal

Report instead. How would this decision by the client regarding the report option affect the appraiser's scope of work for the assignment?

• CORRECT ANSWER The scope of work is not affected An appraiser is valuing a property that is known to have environmental contamination, but the appraiser uses a hypothetical condition to value the property as if it was not contaminated. In the appraisal report, the appraiser clearly and accurately discloses the hypothetical condition. Does the appraiser have any other additional USPAP reporting obligations in this situation? - CORRECT ANSWER Yes, the report must state that the use of the hypothetical condition may have affected the assignment results One of the questions an appraiser needs to answer in determining the scope of work in an appraisal assignment is - CORRECT ANSWER How much data is needed? An appraiser has agreed to perform an appraisal assignment on a multi-unit residential property. The client has requested a Restricted Appraisal Report because a full explanation of the appraiser's support and rationale for the value opinion is not necessary. There is another intended user identified in addition to the client. In developing the appraisal, is the appraiser permitted to be less thorough than if an Appraisal Report were being prepared? - CORRECT ANSWER No, because the appraisal development process is not affected by the report option used An appraiser is preparing an Appraisal Report using a form created by the client. The top of the form is labeled prominently "Summary Appraisal Report." Is this acceptable under USPAP? - CORRECT ANSWER Yes, an appraiser may use another label in addition to the one required by USPAP How does USPAP achieve legal authority? - CORRECT ANSWER Through adoption, citation, or implementation by government agencies Who determines the appropriate scope of work to be used in an appraisal assignment? - CORRECT ANSWER The appraiser

An appraiser is valuing a property that is currently offered for sale for $349,000 and is under agreement for $295,000. In the Appraisal Report prepared for the assignment, what is the appraiser's USPAP obligation related to reporting this listing and agreement of sale? - CORRECT ANSWER The appraiser must summarize the results of analyzing the current listing and agreement of sale An appraiser receives a request to perform an appraisal assignment on a property type with which the appraiser is unfamiliar. The appraiser wants to perform the assignment despite their initial lack of knowledge and experience. The appraiser discloses their lack of competency to the client before agreeing to perform the assignment and takes the necessary steps to obtain competency. What other step(s), if any, must the appraiser take to comply with USPAP? - CORRECT ANSWER Disclose in the report the initial lack of competency and the steps taken to complete the assignment competently Appraiser Alonzo has a brother, Ernesto, who referred a client to Alonzo. Alanzo thanked Ernesto, and thought nothing of it. Ernesto called Alonzo the next day and asked, "I thought if I referred a client to you, the least you could do is pay me a referral fee!" Alonzo thinks about it, and sends Ernesto a $50 gift certificate. Did Alonzo violate USPAP? - CORRECT ANSWER No, Alonzo can pay referral fees as long as the referral is disclosed in the certification of the report An appraiser is providing a value opinion using an effective date in the past (i.e., a retrospective appraisal). When does the appraiser's competency apply? - CORRECT ANSWER At the time of the agreement to perform the assignment An appraiser transmitted a misleading appraisal review report to the client. Which rule in USPAP has been violated? - CORRECT ANSWER ETHICS RULE A client engages an appraiser to complete an appraisal on a residential property, and the appraiser reports the assignment results

in a Restricted Appraisal Report. Which statement is true regarding the appraiser's workfile obligations for this assignment? - CORRECT ANSWER The data and documentation in the workfile must be sufficient to produce an Appraisal Report. An appraiser agrees to perform an appraisal for a very secretive client who insists that their identity not appear in the appraisal report. What should the appraiser do? - CORRECT ANSWER State in the report that the client's identity has been withheld at their request, but has been retained in the workfile A subject residential house has an unusual configuration and it therefore takes the appraiser a great deal of time to measure and make the calculations to arrive at the calculations of gross living area (GLA). The appraiser's GLA figure is best described as: - CORRECT ANSWER A physical characteristic USPAP outlines a valuation process that appraisers should employ when performing an appraisal. Which of the following is not one of the steps in this process? - CORRECT ANSWER Identify the root causes USPAP requires that information about a property's relevant characteristics must be obtained from sources that: - CORRECT ANSWER The appraiser reasonably believes are reliable When a real property appraiser completes an appraisal for real property improved with a proposed construction of a new dwelling as of a current effective date, what is one of the assignment conditions the appraiser has identified? - CORRECT ANSWER Hypothetical condition An appraiser completes an appraisal for Lender A. A few days after the completed report was transmitted to Lender A, Lender B contacts the appraiser and asks the appraiser to revise the completed appraisal report to indicate Lender B as the client. Which is the correct way for the appraiser to handle this situation in accordance with USPAP - CORRECT ANSWER Consider the request from Lender B as a new assignment

When disclosing the scope of work performed in an Appraisal Report, the appraiser must: - CORRECT ANSWER Provide a level of information that is appropriate for the intended use What is a feasibility analysis intended to study? - CORRECT ANSWER A cost-benefit analysis Harvey accepts an appraisal assignment. He finishes the field work, and starts his analysis. Realizing the value seems to be coming in very low, he says "This won't meet my client's expectations at all!" Harvey calls the client and tells him "a number." The client is quite concerned, cancels the appraisal, and pays Harvey a trip charge. What must Harvey do to comply with USPAP? - CORRECT ANSWER Harvey must have a workfile in support of his value opinion, and place a summary of his oral report in the workfile In developing an appraisal, an appraiser makes a minor error that does not affect the value conclusion. Is this a violation of USPAP? - CORRECT ANSWER No, because competence does not require perfection Which of these is NOT an assignment element, as defined by USPAP? - CORRECT ANSWER Letter of engagement Under USPAP, how is an assignment condition best described? - CORRECT ANSWER An assumption, extraordinary assumption, hypothetical condition, law, rule, or other condition that affects the scope of work An appraiser is offered an appraisal assignment on a waterfront property. The appraiser does not have the knowledge and experience in appraising waterfront properties, but the appraiser still wants to perform the assignment. When is the appraiser required to disclose their lack of knowledge and experience to the client? - CORRECT ANSWER Before agreeing to perform the assignment

If an appraiser uses an acceptable scope of work in an appraisal assignment, the most likely result is: - CORRECT ANSWER Credible assignment results An opinion of the highest and best use of a property is: - CORRECT ANSWER A step that might be necessary in some appraisals, but not others An appraiser is preparing a Restricted Appraisal Report in a situation in which there are other intended users in addition to the client. Which statement is TRUE regarding this situation? - CORRECT ANSWER The appraiser must identify the other intended users by name in the report An appraiser is developing an opinion of value for an older three-unit property in a neighborhood that is in transition to single-family, owner- occupied housing. All sales of two- to four-family dwellings in the neighborhood that have sold in the past year have seen conversion to single-family, owner-occupied dwellings. The appraiser chose in the original scope of work to NOT develop the income approach and rely solely on the sales comparison approach. What else should the appraiser do with regard to this decision? - CORRECT ANSWER Include data in the workfile and discussion in the appraisal report supporting the reasoning for excluding the income approach. An appraiser is making a personal inspection of a subject property. While at the property, the appraiser observes that the subject property has defective paint surfaces on the front porch floor and railing. This observation is: - CORRECT ANSWER A physical characteristic What process does an appraiser use to value a universe of properties using standard methods and common data? - CORRECT ANSWER Mass appraisal An appraiser must disclose the scope of work in an appraisal report. USPAP requires that the scope of work disclosed must: - CORRECT ANSWER Be the scope of work that was actually performed by the appraiser

Appraiser Alex receives significant appraisal assistance from Appraiser Bonnie in an appraisal review assignment. Appraiser Bonnie does not sign the report. Where must Appraiser Bonnie's name appear in the report? - CORRECT ANSWER In the certification An appraiser is valuing a complex residential property. The appraiser does not inspect the property; instead the appraiser obtains information about the property's physical characteristics from municipal records. Is this permissible under USPAP? - CORRECT ANSWER Yes, as long as the appraiser reasonably believes the municipal records are reliable An appraiser prepares an appraisal report on a residential property for an eminent domain taking. The appraiser must retain the workfile for this assignment for at least: - CORRECT ANSWER 5 years after preparation or at least 2 years after final disposition of judicial proceedings in which testimony was given, whichever period expires last If a client requests an "as repaired" value for a property that is now damaged by fire, with a current effective date, what will be used in the assignment? - CORRECT ANSWER Hypothetical condition With regard to avoiding errors in an appraisal, what does the COMPETENCY RULE require appraisers to do? - CORRECT ANSWER Use due diligence and due care An appraiser is preparing an appraisal report using a pre-printed report form that was created by the client. The pre-printed certification on the form does not contain all of the required elements of the certification required by STANDARD 2 of USPAP. What is the best course of action for the appraiser? - CORRECT ANSWER Include a supplemental certification that includes the additional elements required by USPAP An appraiser is preparing a narrative-type appraisal report on a residential property. The appraiser has an obligation, under USPAP, to ensure that the report contains sufficient information to enable

________ to understand the report properly. - CORRECT ANSWER Intended users Features that may affect a property's value or marketability are best described as: - CORRECT ANSWER Relevant characteristics An appraiser is valuing a property and has been requested by the client not to inspect the property. Instead, the appraiser is asked to rely on information obtained from a third-party inspector regarding the property's relevant physical characteristics. The third-party inspector's report is incomplete, poorly prepared, and contains conflicting information. After spending a lot of time studying the inspector's report, the appraiser determines it is not credible. The appraiser still wants to complete the assignment. What is the appraiser's best course of action in this situation? - CORRECT ANSWER Contact the client and discuss changing the scope of work Which of the following terms is defined in USPAP as the type and extent of research and analysis in an assignment? - CORRECT ANSWER Scope of work A real property appraiser has been asked by Lender A to readdress an appraisal report in which they had engaged the appraiser, and send the report to Lender B. Lender B then contacts the appraiser and asks the appraiser to replace Lender A as the client in the assignment report with Lender B. How should the appraiser handle this request? - CORRECT ANSWER Refuse to accommodate this request as readdressing an appraisal report or adding an intended user after it is completed is not in compliance with USPAP. A reviewer concluded that an appraisal they were reviewing was not credible. How is the credibility of an appraisal measured? - CORRECT ANSWER In the context of intended use Which of the following valuation specialists is violating the USPAP ETHICS RULE? - CORRECT ANSWER Jack Platt performs an appraisal acting as an advocate for his client and discloses that advocacy.

Evan is preparing the appraisal of a single-unit dwelling. The family room requires extensive repairs due to water damage. The client, a lending institution, has given instructions to Evan to utilize a hypothetical condition and report the value of the subject property as if repairs had already been made. Evan has only worked on "as is" assignments. While working on the sales comparison approach, Evan finds comparable sales that are in the same condition as the subject property pre-repairs. He uses these sales, but does not make adjustments to reflect the hypothetical condition. This results in an "as repaired" value that is nearly the same as the "as is" value. When Evan reports his findings to the client, the client is surprised at the relatively low "as repaired" value and sends the appraisal out for an independent peer review. The reviewer notes the missing condition adjustments and the subsequent - CORRECT ANSWER COMPETENCY RULE An appraiser is valuing a new 80-unit apartment building in a declining market. The area's major employer has closed down, leading to declines in property values and rents and a large out-migration of residents from the region. In valuing the property, the appraiser uses the extraordinary assumption that this new apartment building can achieve 95% occupancy rate at market rents within a 6-month period. Is the use of this extraordinary assumption appropriate? - CORRECT ANSWER No, because the appraiser has no reasonable basis for this assumption According to the Management Section of the ETHICS RULE, an appraiser may agree to a referral fee, management fee, commission, or anything of value in connection with obtaining an assignment as long as the appraiser: - CORRECT ANSWER Discloses the payment of a fee in the appraisal report An appraiser must disclose any fees, commissions, or things of value that are connected to the procurement of an assignment in the certification and in any transmittal letter in which the conclusions are stated.

In preparing a Restricted Appraisal Report, one requirement of the workfile is that it: - CORRECT ANSWER Contain sufficient information for the appraiser to be able to produce an Appraisal Report While appraising a residence, an appraiser found that the subject property had sold two years before the effective date of the appraisal. According to USPAP, the appraiser must: - CORRECT ANSWER Analyze the sale because it occurred within three years of the effective date An appraiser is engaged by a client to value a residential property. As part of the engagement, the client sends the appraiser a form titled "Scope of Work Agreement" that provides detailed instructions regarding the scope of work the appraiser must use for the appraisal. May the appraiser agree to perform the assignment when the client specifies the scope of work? - CORRECT ANSWER Yes, but only if the client-specified scope of work allows the appraiser to produce credible assignment results You performed an appraisal two years ago that was never used in a loan or in any other manner by the client. The client now requests that you destroy the workfile and any records of the appraisal. Is this ethical? - CORRECT ANSWER No, USPAP does not permit appraisers to destroy written records prior to five years after preparation for any reason According to STANDARD 3, an appraiser performing an appraisal review must do all of the following except: - CORRECT ANSWER Develop his or her own opinion of value Appraiser Elizabeth appraises a mixed-use property for a lender client. In the appraisal report, Elizabeth discloses that a power plant is located near the subject property, and she considers its effect on the subject's value and marketability. She makes an adjustment for the power plant in the sales comparison approach. The client insists Elizabeth remove the discussion of the power plant from the appraisal report. Elizabeth justifies the removal of the power plant from her comments because she has retained the power plant adjustments in

the sales comparison approach. Is Elizabeth complying with USPAP? - CORRECT ANSWER No, she could have a misleading report Peter is appraising a specialized industrial property situated on two acres of land in a rural area. The facility is a unique structure for that region; there are no comparable sales known to Peter after an exhaustive search for data. The client has requested a value in use appraisal of the fee simple interest of the subject property. Three weeks after submitting the report, the client calls. They are demanding that Peter develop an opinion of exposure time for the subject property. Is Peter required to develop an opinion of exposure time in this situation? - CORRECT ANSWER No. STANDARD 1 of USPAP only requires a development of exposure time when exposure time is a component of the value definition being used. An appraiser may perform an appraisal review assignment, as defined by USPAP, on any of the following assignments EXCEPT: - CORRECT ANSWER A broker's price opinion (BPO) on a single-unit dwelling. An appraiser is preparing a Restricted Appraisal Report for a client. The client's informational needs are such that several parts of the report contain more information than the minimum requirements of USPAP. What should the appraiser do regarding identification of the report type? - CORRECT ANSWER Identify the report as a Restricted Appraisal Report When making a scope of work decision, an appraiser is required to consider certain assignment elements. Which of the following is not an element that must be considered in the scope of work decision? - CORRECT ANSWER Sales history An appraiser is asked to perform a "condition and marketability report." The appraiser is not required to provide a value conclusion as part of the assignment. Which statement is TRUE regarding this assignment? - CORRECT ANSWER The appraiser must follow USPAP since this is a valuation service that is part of appraisal practice, even though no conclusion of value was requested.

An appraiser who commits a series of small errors that affect the credibility of the assignment results has violated the rule against - CORRECT ANSWER Rendering services in a careless or negligent manner One of the benchmarks of an acceptable scope of work is what the appraiser's peers' actions would be in performing the same or a similar assignment. Who are an appraiser's peers? - CORRECT ANSWER Other appraisers who have expertise and competency in a similar type of assignment A client's business partner contacts an appraiser and requests information relating to an appraisal report the appraiser had prepared for the client. May the appraiser disclose the results of the appraisal to the client's business partner? - CORRECT ANSWER Yes, provided the appraiser obtains authorization from the client before sharing any confidential information If the appraiser notes that the subject property transferred via a Sheriff's auction within the past three years, how should the transfer be handled? - CORRECT ANSWER Analyze the transfer. You recently appraised a single-family residence for the owner, who is selling the property. A potential buyer has just contacted you to obtain a copy of the appraisal report. What should you do? - CORRECT ANSWER Do not give the buyer a copy because the seller is your client, and therefore he is the only one who can authorize you to disclose the information Is it ethical if an appraiser pays a fee to be included on a lender's "approved appraiser" list? - CORRECT ANSWER Yes, provided the appraiser discloses the payment of a fee in the appraisal report Henrietta is appraising a single-unit dwelling to establish asset value for estate planning purposes. The owner/client has indicated they require an "as is" value as of June 10, to correspond with the dates of appraisals being performed on other assets. Henrietta's appraisal will be used with the owner's investment planner to create an appropriate

financial plan. The date of inspection is June 15, 2019. The effective date is June 10, 2019 per the client's request. The payment to Henrietta is made July 1, 2019. Photos of the subject property were taken on the date of inspection. Photos of comparable sales were taken June 16, 2019. General data about the subject were collected June 17, 2019. The date of the report is June 20, 2019. Given the dates above, the workfile must be retained until: - CORRECT ANSWER 6/20/2024 Stephanie, a certified residential appraiser and licensed broker, is contacted by a home seller to perform a comparative market analysis (CMA) to assist the seller in marketing the house. Stephanie is most probably acting - CORRECT ANSWER As a broker and is outside of appraisal practice Stephanie is a professional in both appraisal and brokerage. She has been hired to perform a CMA for a client. She has not been hired to be an appraiser. Therefore, Stephanie is performing outside of appraisal practice and must not misrepresent her role. A property owner asks you to appraise her property and states that you will be compensated only if you arrive at a value of $100,000 or greater. You should: - CORRECT ANSWER Refuse to do the appraisal and tell her it is unethical to accept compensation based on a predetermined value An appraiser develops an appraisal on a property in order to help set an asking price for the current owner. In the appraisal report, the appraiser certifies that they did not make an inspection of the subject property. Is this permissible under USPAP? - CORRECT ANSWER Yes, USPAP does not require an appraiser to personally inspect the subject property One example of a situation in which a hypothetical condition may be used is: - CORRECT ANSWER When appraising proposed construction as of a current effective date

A local builder hires you to provide a market value appraisal in order to secure financing for a construction loan. He provides you with the necessary plans and specifications for the proposed construction. The site is currently zoned R-1 single-family residential, but the developer is planning to build a duplex. He has already filed to change the zoning to R-2 with the city zoning department and is quite confident that his application will be approved. The change will permit up to two residential units to be built on one lot. You appraise the property using a current effective date, and value the property as though the zoning had been changed by the effective date of the appraisal. In order to conform to USPAP, you must use a(n): - CORRECT ANSWER Hypothetical condition If an appraiser does not charge a fee for their appraisal services, the appraiser: - CORRECT ANSWER Must still comply with USPAP In obtaining information about subject property characteristics, USPAP requires an appraiser to use only - CORRECT ANSWER Sources the appraiser believes reliable An appraiser agrees to perform an appraisal assignment that specifies the appraisal report must be delivered to the client within 14 days of the appraiser's inspection of the property. Due to unforeseen circumstances, the appraiser was unable to deliver the report to the client until 21 days after the inspection. Which statement regarding this situation is true? - CORRECT ANSWER This is a contractual issue between the appraiser and the client and is not a violation of USPAP. Due date is not an assignment condition because it does not affect the scope of work. This is a contractual issue between the appraiser and the client, but delivering the report late in this situation does not constitute a violation of USPAP. When appraising a single-unit residence, the appraiser is required by USPAP to analyze all sales of the subject property that occurred in the previous: - CORRECT ANSWER 3 years

Which of the following statements about an appraisal review is FALSE? - CORRECT ANSWER An appraisal review is a review of an appraised property. An appraisal review is not a review of an appraisal property, but rather a review of all or part of another appraiser's work. The work being reviewed could be the report, the workfile, or a combination Which of the following statements about an extraordinary assumption is FALSE? - CORRECT ANSWER It is contrary to what exists, but is assumed for the purpose of analysis. An extraordinary assumption presumes something as fact about the physical, legal, or economic characteristics of the subject property or about external conditions such as market conditions or trends, or about the integrity of the data used in analysis. If the presumption is found to be false, it could alter the appraiser's opinions or conclusions. Steven, a certified residential appraiser, has received a notice from his state licensing board. They have received a complaint about an appraisal he completed 3 years ago. The board wants to see his report and workfile as a part of their investigation. Steven refuses to turn over the report and workfile, stating "This information is confidential to my client, and the client has not authorized me to surrender this material." Is Steven violating USPAP? - CORRECT ANSWER Yes. According to the RECORD KEEPING RULE, the appraiser must make the workfile available to state appraiser regulatory agencies. Disclosure of the scope of work - CORRECT ANSWER may be placed anywhere in the appraisal report and does not need to be labeled. No specific format or location for the disclosure of the scope of work is required. It can be placed anywhere in the appraisal report and does not need to be labeled as such. Richard accepted an appraisal assignment to appraise a suburban shopping center. The shopping center was under contract for $4,000,000. He employed the income and sales comparison

approaches. His conclusion of value was $3,500,000. When he submitted the written report to his client, ABC Bank, the bank's representative called and threatened Richard: "You will never get another assignment from us again! We will turn you in to the state licensing board" Richard relents, and changes the value to $4,000,000. Richard thinks: "It is, after all, just an opinion." Has Richard violated USPAP? - CORRECT ANSWER Yes, he acted with bias in favor of a client's cause. An appraiser is hired by a seller to appraise his property. During the course of the appraisal, the appraiser reviews the property's confidential income statement. A potential buyer later asks the appraiser if she can see the appraisal data. What should the appraiser do? - CORRECT ANSWER Give the data to the buyer only if the appraiser's client specifically authorizes its release to the buyer A new house is being appraised for mortgage lending purposes. Sales in the area are scarce. There are no comparable rental houses available for analysis. The client is a local lender that does not plan to sell the mortgage in the secondary mortgage market. The client has instructed Appraiser Sarah to appraise the newly-constructed house, and to utilize only the sales comparison approach. Sarah performs the inspection and collects market data. She concludes that the cost approach should receive most of the weight in her final reconciliation. What should she do? - CORRECT ANSWER Sarah should proceed with the cost approach after she discusses the situation with the client. Madeline performs an appraisal of a four-unit residential property. The effective date is January 4, 2021. The date of the report is January 8,

2021. Madeline receives a notice that her appraisal will be used in a court case involving the subject property. She provides expert testimony in this case on November 10, 2021. Final disposition of the court case occurs on April 26, 2022. How long must she retain this workfile? - CORRECT ANSWER January 8 of 2026 An appraiser must create and maintain a workfile for: - CORRECT ANSWER Any assignment that is covered by Standards Rules

An appraiser is offered an appraisal assignment by a very picky potential client. The potential client specifies that all comparable sales used in the appraisal must have closed within the last 90 days. The appraiser is familiar with the property and the market area and thinks there might be sales that are over 90 days old that are better comparables because they are more physically similar to the subject. What should the appraiser do? - CORRECT ANSWER Communicate with the client and have them agree that the appraiser will determine which sales to use The appraiser and the client should agree that the appraiser will select the comparables that he/she believes are the best. Complying with a client's arbitrary restriction on the sales used in the sales comparison approach could result in poor comparables being selected and a non-credible value opinion being developed. USPAP requirements do NOT apply in the performance of: - CORRECT ANSWER A broker price opinion When is an appraiser required to develop an opinion of reasonable exposure time in an appraisal of real property? - CORRECT ANSWER When exposure time is a component of the value definition being used Parties who receive copies of an appraisal report - CORRECT ANSWER Do not become intended users unless originally specified at the time of the assignment You sign an appraisal report, and your supervisor also signs it on the line as a supervisory appraiser. Who is responsible for the contents of this report? - CORRECT ANSWER Both of you equally An appraiser performs an appraisal review and concludes that the work under review is complete and its conclusions are credible. No testimony was given as part of the assignment. The appraiser must retain the appraisal review report and the workfile for at least ______ year(s). - CORRECT ANSWER 5