ASA USPAP Flashcards
in 1929, the first nationally recognized standards for appraisal practice was published by ___________
National Association of Real Estate Boards (now known as the National Association of REALTORS)
Federal agencies that insure, guarantee, or purchase mortgages
Federal Housing Administration (FHA);
Dept. of Veteran Affairs (VA); and
Federal National Mortgage Association (Fannie Mae).
What did Title XI of the Federal Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), also known as the Savings and Loan Bailout Bill, do?
It required the Federal Reserve Board and other federal agencies to issue regulations to protect federal financial and public policy interests in real estate transactions requiring an appraiser.
Which federal law recognized the Uniform Standards of Professional Appraisal Practice as the generally accepted standards of appraisal practice?
Title XI of the Federal Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), also known as the Savings and Loan Bailout Bill.
What is the name of the committee that eventually became to be known as USPAP?
the “ad-hoc” committee.
What was the “ad-hoc” committee?
eight organizations in the US and the Appraisal institute of Canada formed to develop professional standards that would eventually become the USPAP.
What are the four boards of The Appraisal Foundation (“TAF”)?
a) The Appraiser Qualifications Board (“AQB”);
b) The Appraisal Standards Board (“ASB”);
c) The Board of Trustees (“BOT”); and
d) The Appraisal Practices Board (“APB”).
When was TAF established?
1987.
What is the expressed purpose of USPAP?
…promoting and preserving the public trust in professional appraisal practice.
Which TAF boards have the task of “cultivating greater trust and confidence in professional appraisal practice?”
the AQB and ASB
with support from the sponsoring organizations of TAF
Trust includes the attributes of:
5 attributes
i) specialized knowledge;
ii) experience;
iii) objectivity (impartiality);
iv) independence; and
v) integrity.
Is TAF a private entity or government agency?
TAF is a private entity.
How does USPAP achieve legal authority?
USPAP achieves legal authority by the adoption, citation, or implementation by govt. agencies through regulation or administrative actions, or by private enterprise in the form of contract requirements.
Is TAF a professional appraisal organization?
no.
Is TAF a membership organization?
no.
What is TAF?
a) an org. specifically authorized by Congress regarding real property appraiser qualifications and appraisal standards;
b) an organization made up of other organizations.
How is TAF funded?
TAF is funded by federal grants, sales of publications and services, and from “sponsoring organizations.
What are the three categories of TAF sponsoring organizations?
appraisal sponsors (non profit appraisal orgs.);
affiliate sponsors (non profit orgs. with an interest in appraising); and
international sponsors (non and for profit orgs. based outside of the US with an interest in valuation).
What are TAF’s three advisory councils?
a) The Appraisal Foundation Advisory Council (TAFAC);
b) The Industry Advisory Council (“IAC”); and
c) The Valuers Global Forum (“VGF”).
What is the purpose of TAFAC?
The purpose of TAFAC is to involve the public in the development of appraisal standards and appraiser qualifications.
Who comprises TAFAC?
TAFAC is comprised of non-profits which represent appraisers, financial institution regulators, the secondary mortgage market, the private mortgage insurance industry, real estate brokers, and home builders.
What is the purpose of the IAC?
The purpose of the IAC is to allow for-profit entities an opportunity to provide input to TAF.
Who comprises the IAC?
The IAC is made up of for-profit organizations that represent appraisal companies, lending institutions, insurers, brokerage companies, relocation companies, and others.
What is the purpose of the VGF?
the VGF provides international information and support to TAF, the ASB and the AQB.
What is the VGF?
The Valuers Global Forum.
What is the IAC?
The Industry Advisory Council.
What is the TAFAC?
The Appraisal Foundation Advisory Council.
What is the role of the BOT?
The Board of Trustees exercises all authority and power and performs all functions of TAF, except for the authority, powers and functions that the Articles of Incorporation (or Bylaws) have directed/required to be exercised or performed by the AQB or the ASB.
What are the three primary functions of the BOT?
a) appoint members to the APB, AQB, and ASB;
b) to secure funding for TAF;
c) to monitor performance and oversee TAF and its three boards (APB, AQB, and ASB), and three advisory councils (IAC, IVC and TAFAC).
Assumes conditions contrary to known facts
hypothetical condition
Services performed by an individual acting as an
appraiser
appraisal practice
Presumes as fact otherwise uncertain information
extraordinary assumption
A preference that precludes an appraiser’s impartiality
bias
The amount asked, offered, or paid for a property
price
Services pertaining to aspects of property value
valuation services
The act or process of developing an opinion of value
appraisal
An opinion that expresses an economic concept
value
___________ is a valuation service performed by an
individual acting in the role of an appraiser.
Appraisal practice
When performing valuation services outside of
appraisal practice, appraisers must be careful not to
___________ their role.
misrepresent
For assignments others than appraisal or appraisal
review, there are no ___________or ____________
requirements in USPAP.
workfile or record keeping
What appraisal services are covered by USPAP?
Appraisal;
Appraisal review; and
Other services while acting in the role of an appraiser.
Providing transaction research is a service within ___________ that has no applicable Standards Rules in USPAP.
appraisal practice
T/F:
If an individual, who is both a business broker and an appraiser, provides a “value” opinion for a specific property to be used in an offering document, the service is always outside appraisal practice.
False
T/F:
An individual must comply with USPAP when required by law, regulation, or agreement.
True
T/F:
Appraisal practice pertains only to appraisals.
False
T/F:
An appraiser has a professional responsibility to identify the capacity in which he or she is performing.
True
T/F:
The purpose of USPAP is to promote and maintain a high level of public trust in professional appraisal practice.
True
Business brokerage, appraisal reviews, and business appraisals are all included within:
A. appraisal practice.
B. consulting.
C. valuation services.
D. market analysis.
C. valuation services.
The PREAMBLE of USPAP states that the Standards are:
A. only for appraisers.
B. for appraisers and users of appraisal services.
C. limited to appraisers who are licensed or certified by states.
D. only for users of appraisal services.
B. for appraisers and users of appraisal services.
According to USPAP, the party or parties who engage an appraiser in a specific assignment defines the:
A. client.
B. party who pays the fee.
C. appraiser’s peers.
D. other intended users.
A. client. (Correct Answer)
For real property appraisers, USPAP is enforced by:
A. The Appraisal Foundation.
B. the Appraisal Standards Board.
C. the Appraisal Subcommittee, through Congress.
D. state regulatory agencies.
D. state regulatory agencies. (Correct Answer)
USPAP is developed, interpreted, and amended by the:
A. Appraisal Standards Board.
B. Appraiser Qualifications Board.
C. Appraisal Subcommittee.
D. state regulatory agencies…
A. Appraisal Standards Board. (Correct Answer)
Which of the following best describes the Statements on Appraisal Standards?
A. offer advice, but do not carry the same weight as the Standards Rules
B. have the full weight of a Standards Rule and can be adopted by the ASB only after exposure and comment.
C. do not establish new standards or interpret existing standards but are issued to illustrate the applicability of appraisal standards in specific situations.
D. are not an integral part of the Uniform Standards and are extensions of the Standards Rules.
B. have the full weight of a Standards Rule and can be adopted by the ASB only after exposure and comment. (Correct Answer)
If an appraiser assumes a condition contrary to what exists on the effective date of the assignment results, but is used for the purpose of analysis, this is an example of:
A. an extraordinary assumption.
B. an assumption.
C. a limiting condition.
D. a hypothetical condition.
D. a hypothetical condition. (Correct Answer)
Why are USPAP Advisory Opinions issued?
A. to illustrate the applicability of appraisal standards.
B. to establish new appraisal standards.
C. to interpret existing standards.
D. to revise existing standards.
A. to illustrate the applicability of appraisal standards. (Correct Answer)
If an appraiser assumes as fact otherwise uncertain information, which, if found to be false could alter her opinions and conclusions, this is an example of:
A. an extraordinary assumption.
B. an assumption.
C. a limiting condition.
D. a hypothetical condition.
A. an extraordinary assumption. (Correct Answer)
A workfile must be maintained for:
A. written appraisal reports only.
B. oral appraisal reports only.
C. valuation services that are outside USPAP.
D. any assignment that is covered by Standards Rules.
D. any assignment that is covered by Standards Rules. (Correct Answer)
Advisory Opinions are best described as:
A. issued by the Appraisal Subcommittee.
B. subject to Fannie Mae requirements.
C. not part of USPAP, but included as reference material.
D. an alternative index to USPAP.
C. not part of USPAP, but included as reference material. (Correct Answer)
An intended user is:
A. anyone who uses the appraisal report.
B. only the party who pays for the appraisal report.
C. anyone who receives the appraisal report from the client.
D. a party who is identified by the appraiser based on communication with the client at the time of the assignment.
D. a party who is identified by the appraiser based on communication with the client at the time of the assignment. (Correct Answer)
A tangible object that is not real estate is:
A. real property.
B. personal property.
C. a business entity.
D. borrowed property.
B. personal property. (Correct Answer)
Appraisal practice includes only:
A. valuation services performed by an individual acting as an appraiser.
B. market value appraisals.
C. work completed by licensed and certified appraisers.
D. appraisal or appraisal review
A. valuation services performed by an individual acting as an appraiser. (Correct Answer)
Who maintains the official national registry of state certified and licensed appraisers?
A. Appraiser Qualifications Board.
B. Appraisal Standards Board.
C. The Appraisal Foundation.
D. Appraisal Subcommittee.
D. Appraisal Subcommittee. (Correct Answer)
T/F:
It is unethical to accept an assignment with the understanding that payment will be made if and when the transaction closes.
True
T/F:
Under USPAP, confidential information is information the appraiser receives from the client, is not available from any other source and is identified by the client as confidential; or classified as confidential or private by applicable law or regulation.
True
T/F:
An appraiser may only disclose confidential information to the client and persons specifically authorized by the client.
False
T/F:
The COMPETENCY RULE requires the appraiser to disclose the lack of knowledge or experience before accepting an assignment.
True