Understanding USPAP: Appraisal Practice Standards, Exams of Real Estate Management

Download Understanding USPAP: Appraisal Practice Standards and more Exams Real Estate Management in PDF only on Docsity!

USPAP Practice Test Question and Answers

(Verified Answers)

The PREAMBLE states the purpose of USPAP is to maintain public ___ in the appraisal practice by establishing requirements for appraisers. - trust

USPAP benefits providers of appraisal services and - users of appraisal services.

Which is NOT considered significant real property appraisal assistance? - collecting employment data for use in analysis

A valuation service performed by an individual acting as an appraiser requires the appraiser to - inquire about the intended user's expectations.

When an individual is performing valuation services outside of appraisal practice, that individual must be careful to - not misrepresent his role.

When choosing to provide a valuation service as an appraiser or in some other capacity, great care must be taken to - maintain public trust.

A real property appraiser teaching appraisal is engaged in - appraisal practice with no applicable Standards (1-10).

A lender has telephoned an appraiser to determine the high and low sales 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 has supplied a list of all of the sales within the past year in the subdivision and billed the lender for service. The service being provided by the appraiser is - appraisal practice with no performance standards or record keeping requirements.

In accordance with USPAP, which is NOT an expectation when acting in the role of an appraiser? - holding a state license or certification

Compliance with USPAP is required when obligated by - agreement, law, or regulation.

When an appraiser is providing a service other than an appraisal or appraisal review, which would NOT apply? - RECORD KEEPING RULE

Zachary's client instructs him to report a specific property value as a condition of the assignment. The assignment - is a violation of the ETHICS RULE.

Which of these activities does the Conduct section of the ETHICS RULE prohibit? - criminal conduct

Jack appraised a residential dwelling that is located across the street from a factory that he determined is negatively affecting the value of the subject property. Jack applied a location adjustment in his sales comparison approach. However, the client asked that the factory not be discussed in the appraisal report. Since Jack addressed the condition with an adjustment, has he complied with USPAP? - no, omitting the discussion could produce a misleading report

Anthony received an appraisal assignment for a property that was previously appraised by him. He understands that be must handle confidential information appropriately. What else must Anthony do? - make proper disclosure regarding the prior assignment

Marcus was hired to appraise a home that be had previously appraised one year ago. May Marcus accept the assignment? - yes, as long as he discloses the previous service on the property to the client and in the subsequent report certification

A real property appraiser has paid a fee to procure an appraisal assignment. According to the Management section of the ETHICS RULE, where must the fee be disclosed? - in the certification and any transmittal letter

Josh received an appraisal request from a lender-client who told him, to immediately call if the value on the property is less than the amount stipulated by the lender, as he doesn't intend to pay for an appraisal that won't benefit his position. Will acceptance of this assignment be in compliance with USPAP? - no, an appraiser may not accept an assignment with unacceptable assignment conditions

Which of the following would NOT be considered an unacceptable fee arrangement? - fee based on the volume of total business from a particular client

According to the Management section of the ETHICS RULE, an appraiser affixes his or her signature in an assignment for what purpose? - certify recognition and acceptance of USPAP responsibilities

A real property appraiser has taken great precaution to safeguard his electronic signature; however, the signature has been illegally obtained and used without the appraiser's authorization. Has the appraiser violated USPAP? - no, if the appraiser used great care, he is not responsible for unauthorized use

Confidential information can be disclosed to persons specifically authorized by the client, state appraisal agencies, third parties as authorized by law, or a(n) - duly authorized professional peer review committee.

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 has just called Anne to inquire about the appraised value. Which is a true statement? - Anne must get consent from the lender prior to disclosing the appraised value.

When an appraiser is offered the opportunity to appraise a property for a new client that was the subject of a prior assignment, and the appraiser is not bound to keep the previous assignment confidential , the appraiser must - protect any confidential information from the first assignment and disclose the prior appraisal.

Which best defines a professional peer review committee? - committee comprised of other appraisers

Anthony and Beth acted as co-appraisers on an appraisal assignment and Anthony, Beth's supervisor, has custody of the work. File. Beth has received a court order to appear with a true copy of the appraisal report kept in the work file in a case involving possible mortgage fraud. Must Anthony provide the copy of the report to Beth so that she may comply with the court order? - yes, to be compliant with due process of law,

Anthony must provide the appraisal report copy

When an appraiser is providing a value opinion using an effective date in the past (retrospective), when does the appraiser's competency apply? - at the time of the assignment

Which would NOT be considered a competency factor in a particular assignment? - appraiser 's credentials

If an appraiser is unable to comply with the COMPETENCY RULE to complete an assignment competently, he is obligated to - decline or withdraw from the assignment.

The Conduct section of the ETHICS RULE requires the appraiser to disclose previous services as an appraiser or in any capacity regarding the subject property for what period of time prior to accepting an assignment? - three years

Disclosure of fees, commissions, and things of value given in connection with the procurement of an assignment must be disclosed in what part of a report or specific document? - certification and any letter of transmittal

Authorization to affix or use an appraiser's signature can be granted only - on an assignment-by- assignment basis.

According to the RECORD KEEPING RULE, what information is NOT required to be in a work file? - specific names of other intended users

Which is NOT an element of problem identification? - reporting option to be used in the assignment

Most of the information necessary for the appraiser to identify the problem in a particular assignment - requires communication with the client.

An appraiser's peer is defined as: - other appraisers who have expertise and competency in a similar type of assignment.

When can an extraordinary assumption be used regarding information not available to the appraiser due to assignment conditions? - when credible assignment results can still be developed

Which is NOT an option when an appraiser finds circumstances that change the research and analysis that he originally planned at the onset of an assignment? - disregard the circumstances and proceed as originally planned

The scope of work disclosed in an appraisal report must include the - scope of work that was actually performed.

Which is NOT a force that could cause an appraiser to invoke the JURISDICTIONAL EXCEPTION RULE? - attorney at law

When the JURISDICTIONAL EXCEPTION RULE is invoked, who determines if the Rule is appropriate? - the appraiser

Scope of work is the "type and extent of research and in an assignment. - analysis

Which would NOT be part of the scope of work decision? - reporting option and format

The scope of work in each particular assignment must be determined when the assignment involves - an appraisal or appraisal review.

When deciding the scope of work, an appraiser must be prepared to demonstrate that the scope of work is sufficient to - produce credible results.

When must an appraiser disclose research and analysis that was not performed in an assignment? - when it is necessary for intended users to understand the report properly and not be misled

An appraiser must not allow assignment conditions to limit the scope of work to such a degree that

• assignment results are not credible in context of

the intended use.

The JURISDICTIONAL EXCEPTION RULE applies when USPAP is - precluded by law or regulation.

Which is NOT one of the three general obligations of an appraiser under STANDARD 1? - report the opinions and conclusions reached by an appraiser

According to the Comment to Standards Rule 1-2 of USPAP, an appraiser must develop an opinion of reasonable exposure time whenever it is - a component of the definition of the value opinion being developed.

Standards Rule 1-3 of USPAP, in part, requires which action in a market value assignment? - development of an opinion of highest and best use

According to Standards Rule 1-4 of USPAP, what quantity of data must be analyzed when a sales comparison approach is necessary for credible assignment results? - such comparable sales as are available

When developing an income approach, Standards Rule 1-4 of USPAP, in part, requires an appraiser to base projections of future rent or income potential and expenses on - reasonably clear and appropriate evidence.

Standards Rule 1-2 of USPAP prohibits an appraiser from allowing the or a client's objectives to cause the assignment results to be biased. - intended use of an assignment

Prospective value opinions occur when the value opinion is expressed - as of an effective date in the future.

What is an appraiser NOT required to do when the subject property is a fractional interest, physical segment, or a partial holding? - value the whole property

Standards Rule 1-5 states that appraisers must analyze agreements of sale, options, and listings of the subject property current as of the effective date of an appraisal, in a market value assignment, if it is - available in the normal course of business.

Standards Rule 2-1 of USPAP requires that appraisal reports contain ___ to enable intended users to understand the report properly. - sufficient information

Standards Rule 2-2 of USPAP requires an appraiser to which reporting option is being used in the assignment. - prominently state in the report

An appraiser has agreed to physically inspect the subject property in a particular appraisal assignment. If the appraiser reviews photographs and other documents that illustrate the relevant characteristics of the property and indicates in the certification language that he has physically inspected the property, the report would be: - misleading and in violation of the Conduct section of the ETHICS RULE.

STANDARD 2 does NOT: - dictate the form, style, or format of an appraisal report.

According to Standards Rules 2-2(a) and (b) (viii) of USPAP, regarding the information analyzed and methodology used in an assignment, the exclusion of ___ must be explained. - the sales comparison approach, cost approach, or income approach

The board of The Appraisal Foundation that identifies and addresses issues relating to recognized methods and techniques is the - Appraisal Practices Board (APB).

Given no agreement with the client to the contrary, an appraiser may provide what information to a third party regarding an appraisal assignment? - confirmation that he or she appraised the property

The level of information necessary in a report and the reporting option chosen by an appraiser depends on the ___ in an assignment, - intended use and intended users

If a letter of transmittal contains the signature of an entity, such as a specific appraisal firm, may that entity's signature also appear on the certification of the appraisal report? - No USPAP requires that an individual appraiser(s) sign the certification.

In developing an appraisal review, Sarah identified the work under review and the characteristics of that work, which are relevant to the intended use and purpose of the appraisal review. What information should Sarah NOT include when developing her appraisal review? - credentials of the appraiser in the work under review

Jennifer is reviewing the analyses, opinions, and conclusions of an appraisal report. During this process, Jennifer disagrees with some of the analyses. What must she do? - develop reasons for any disagreement

A Restricted Appraisal Report may be useful when the: - client understands the limited utility of the option.

Christopher reviewed and signed the certification for an Appraisal Review Report. This means that Christopher accepts responsibility for the assignment results and contents of the report, as well as:

• all elements of the certification.

In a review of an appraisal report, when opinions and conclusions are expressed by the reviewer that concur or disagree with the opinions and conclusions in the work being reviewed, those opinions and conclusions must: - be developed in accordance with the applicable development Standard.

Which term is defined by USPAP as a mathematical expression of how supply and demand factors interact in a market? - mass appraisal model

Which Standard in USPAP expresses that the certification in compliance with this Standard is not intended to disturb an elected or appointed assessor's work plans or oaths in office? - STANDARD 6

When a sales comparison approach is necessary for credible results, an appraiser must: - analyze such comparable sales data as are available to indicate a value conclusion.

An individual is performing in the role of an appraiser consultant in an assignment that does not include an appraisal or appraisal review; thus, the appraiser must comply with all of these USPAP Rules EXCEPT the: - SCOPE OF WORK RULE

In an appraisal for ad valorem taxation purposes, when only one property is the subject of the appraisal assignment, which development Standard would apply? - STANDARD 1

What is NOT a requirement for completing an Appraisal Review Report? - It must include two certifications reporting the appraiser's own value opinion.

In an assignment for which the appraiser was hired by an appraisal management company (AMC), the appraiser may consider the lender the client as long as the AM C is - an authorized representative of the lender.

Intended users in a specific assignment must be identified: - by name or type.

Within USPAP, the appraiser's ___ are (is) always specific to the intended use. - opinions and conclusions

The intended use and the intended user of the appraiser's opinions and conclusions are identified ___ the assignment. - at the time of

While in the role of an appraiser, advocacy - is not permitted.

Craig, a real property appraiser, is not an expert in real estate law. In every assignment, he includes a disclosure stating this fact and that in his conclusions he is considering the property to have good and marketable title. Which best describes Craig's action? - assumption

While appraising a property, Lydia could not check the furnace to see if it is in good working order due to the utilities being off at the time of the inspection. Since the home is relatively new and the components appear to be in good condition, Lydia has a reasonable basis to believe that the furnace is in satisfactory operating condition, but she is not certain. Therefore, Lydia bases her conclusion on a(n) - extraordinary assumption.

If a property is known by the appraiser, on the effective date of the appraisal to have an inoperative mechanical system component, but the appraiser is considering the

component as if it were operating properly on that date for the purpose of his analysis, on what is the appraiser basing his opinions and conclusions? - hypothetical condition

Per the USPAP definition, in order for information to be considered confidential the information must be: - identified by the client as confidential and not available from any other source.

Which best describes an appraiser 's work file? - documentation necessary to support the

appraiser's analysis, opinions, and conclusions

Personalized evidence indicating authentication of the work performed by the appraiser describes, in part, which term? - signature

Which term, is defined by USPAP DEFINITIONS as services pertaining to aspects of property value?

• valuation services

The Standards in USPAP establish a benchmark of criteria to measure: - ethics and competency.

The PREAMBLE of USPAP sets the tone that the purpose of USPAP is to: - promote and maintain a high level of public trust in appraisal practice.

In the USPAP Appraisal Process, which is the final step in the development process? - reconciliation and final value opinion

Which entity or group is responsible for creating and maintaining the national appraiser examination? - Appraiser Qualifications Board

Which is a direct responsibility of the Appraisal Subcommittee? - maintain the National Registry of licensed/ certified real property appraisers

Statements on appraisal standards are: - an integral part that has the full weight of USPAP.

Which board exercises all authority and power over the subject, style, content, and substance of USPAP and other communications related to Standards? - Appraisal Standards Board

Which board establishes minimum education, experience, and examination requirements for real property appraisers to obtain certification? - Appraiser Qualifications Board

Which entity ensures that real estate appraisers who could expose the United States to financial loss are sufficiently trained and tested? - Appraisal Subcommittee

Shelia had concerns about an appraisal situation, and she was uncertain how to proceed. Sheila then consulted the USPAP Advisory Opinions, which: - illustrates the applicability of USPAP in specific situations.

Once proposed changes to USPAP are drafted, which body is responsible for ownership of the language in the draft and votes to approve its release as an exposure draft? - Appraisal Standards Board