Quality Assurance & Improvement Flashcards
7 cards from real CAR practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Quality Assurance & Improvement flashcards as text
A reviewer finds that a commercial appraisal's income approach used a cap rate derived from a single comparable sale. The MOST appropriate reviewer action is to:
Answer: Flag it as a potential deficiency due to insufficient market evidence for the cap rate
A cap rate derived from one transaction lacks sufficient market evidence and should be flagged as a potential deficiency requiring further support.
Under AIR (Appraiser Independence Requirements), which of the following actions by a loan production staff member would constitute a violation?
Answer: Informing the appraiser of the loan amount needed to approve the transaction
Informing the appraiser of the loan amount needed pressures the appraiser to meet a predetermined value, violating appraiser independence.
When a review appraiser disagrees with the original appraiser's value conclusion but cannot identify a specific error in methodology, the reviewer should:
Answer: State the disagreement and provide the reviewer's own analysis and market evidence supporting a different value
The reviewer must support any disagreement with the original conclusion by providing market evidence and analysis, not simply assert a different opinion.
A 'second appraisal' ordered by a lender is MOST appropriate when:
Answer: There is a complex or high-value property, or an inconsistency in the original report warrants additional due diligence
Second appraisals are most appropriate for complex or high-value properties, or when due diligence reveals inconsistencies needing independent verification.
In residential mortgage lending, an Appraisal Management Company (AMC) must ensure that fee appraisers on its panel are:
Answer: Licensed or certified in the state where the property is located
AMCs are required to use only appraisers who hold appropriate state licensure or certification in the jurisdiction where the subject property is located.
When reviewing an appraisal for a property in a rapidly appreciating market, the reviewer should pay particular attention to:
Answer: The time adjustments applied to comparable sales and whether they reflect current market trends
In rapidly changing markets, the adequacy of time adjustments is critical to ensure comparables are properly adjusted to reflect current market conditions.
A lender's quality control program identifies that 30% of appraisals from one appraiser require revision. The MOST appropriate immediate action is to:
Answer: Remove the appraiser from the approved panel pending a performance review
A 30% revision rate signals a systemic quality problem; removing the appraiser from the panel pending review is the appropriate risk management response.