Regulatory Compliance & Legal Framework Flashcards
7 cards from real ARA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Regulatory Compliance & Legal Framework flashcards as text
When a state's appraisal licensing board investigates a complaint against an ARA appraiser, the board's authority is derived from:
Answer: State enabling legislation enacted to comply with FIRREA Title XI requirements
State legislatures enacted appraiser licensing laws to comply with FIRREA's mandate, and those statutes grant state boards their authority to license, regulate, and discipline appraisers.
An appraiser discovers after accepting an assignment that the property has undisclosed underground storage tanks (USTs). Under USPAP, the appraiser should:
Answer: Note the presence of the USTs, recommend an environmental assessment, and consider the impact on value through an extraordinary assumption if necessary
USPAP requires appraisers to identify adverse environmental conditions if they are apparent and analyze their impact, typically using an extraordinary assumption pending a formal environmental assessment.
The Agricultural Foreign Investment Disclosure Act (AFIDA) requires disclosure when:
Answer: A foreign person acquires, transfers, or holds an interest in U.S. agricultural land
AFIDA requires foreign persons to report to the USDA any acquisition, transfer, or holding of interests in U.S. agricultural land to monitor foreign ownership of American farmland.
Under USPAP, what is the key distinction between an 'appraisal review' and an 'appraisal'?
Answer: An appraisal review involves forming an opinion about the quality of another appraiser's work, while an appraisal develops a value opinion for property
USPAP Standard 3 defines appraisal review as developing an opinion about the quality of another appraiser's work, which is distinct from developing a value opinion for real property under Standards 1 and 2.
A rural appraiser licensed in State A needs to appraise a farm property located in State B where the appraiser is not licensed. Under USPAP and typical state law, the appraiser may do so by:
Answer: Obtaining a temporary practice permit from State B, if available, before completing the assignment
Most states offer temporary practice permits allowing out-of-state appraisers to accept occasional assignments; the appraiser must obtain this permit from State B's regulatory body before performing the appraisal.
Which of the following best describes the role of the Appraiser Qualifications Board (AQB) within the appraisal regulatory framework?
Answer: The AQB establishes the minimum education, experience, and examination criteria that state programs must meet for appraiser credentialing
The AQB, operating under The Appraisal Foundation, establishes the Real Property Appraiser Qualification Criteria that state licensing programs must meet as a condition of recognition by the ASC.
A lender asks an ARA appraiser to perform a retrospective appraisal of farmland for estate tax purposes with an effective date two years in the past. The primary challenge specific to this assignment type is:
Answer: Market data must reflect conditions as of the historical effective date, not current market conditions
In a retrospective appraisal, the appraiser must research and use market data and conditions as they existed on the historical effective date, which may require locating older sales and market evidence.