FHA Client Advisory & Consultation 3

Question 1

An FHA client requests an appraisal update letter stating the value has not changed, six months after the original appraisal. What must the appraiser do before issuing the update?

Accepted Answer

Re-inspect the property and research current market data to determine whether the original value still holds

Answer

Before certifying that value is unchanged, the appraiser must conduct a new market analysis and re-inspect or acknowledge current property condition to support the update.

Question 2

When advising a client on the intended use of an FHA appraisal, the appraiser discovers the client plans to use the report for a purpose not originally disclosed. What is the appraiser's obligation?

Accepted Answer

Assess whether the new use renders the appraisal misleading and communicate any concerns to the client

Answer

The appraiser must evaluate whether the undisclosed use would make the appraisal misleading and advise the client accordingly, potentially requiring a new assignment.

Question 3

A client pressures an FHA appraiser to remove a Minimum Property Requirement (MPR) deficiency noted in the report. The appraiser has no new information. What should the appraiser do?

Accepted Answer

Decline to remove it because the observation was accurate and removing it would misrepresent the property condition

Answer

Accurately observed MPR deficiencies cannot be removed from the report without factual basis — doing so would constitute a misrepresentation.

Question 4

An FHA lender asks the appraiser to confirm in the report that the neighborhood is 'stable' to satisfy underwriting requirements, but market data shows declining values. What must the appraiser do?

Accepted Answer

Report market conditions accurately as declining, regardless of the client's preference

Answer

FHA appraisers must report market conditions factually; characterizing a declining market as stable misrepresents material facts.

Question 5

During client consultation, a lender asks an appraiser to value a property 'as repaired' when repairs are not yet complete. What must the appraiser do?

Accepted Answer

Complete an 'as repaired' appraisal using a hypothetical condition, subject to completion requirements, and clearly disclose it

Answer

FHA permits 'as-repaired' appraisals using a hypothetical condition when repairs are incomplete, provided the condition is clearly disclosed and the report is subject to completion.

(FHA) Federal Housing Administration Appraiser Certification Practice Test

(FHA) Federal Housing Administration Appraiser Certification Practice Test

FHA Client Advisory & Consultation 3