Legal & Ethical Standards in Appraisal Flashcards
7 cards from real IACP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Legal & Ethical Standards in Appraisal flashcards as text
The Appraisal Foundation's Appraiser Qualifications Board (AQB) is responsible for:
Answer: Setting minimum education and experience requirements for appraiser credentials
The AQB establishes minimum criteria for appraiser education, experience, and examination that states must adopt for their licensing programs.
An appraiser who knowingly uses a misleading comparable sale to support a predetermined value is most likely guilty of:
Answer: Appraisal fraud and an Ethics Rule violation
Knowingly using misleading data to support a predetermined conclusion constitutes appraisal fraud and violates USPAP's Ethics Rule.
Which of the following correctly describes 'hypothetical condition' in an appraisal?
Answer: A condition that is contrary to what exists but assumed for the purpose of the analysis
A hypothetical condition is a condition assumed to be true for analysis purposes even though it is contrary to known reality.
A lender asks an appraiser to exclude a flood zone adjustment because the borrower plans to purchase flood insurance. The appraiser should:
Answer: Retain the adjustment because flood zone status is a market-recognized factor affecting value
Flood zone designation affects market perception of value independently of insurance availability, and the adjustment must reflect market evidence.
Under USPAP, an appraiser performing a business valuation must:
Answer: Comply with USPAP Business Appraisal Standards (BAS) if applicable
Business appraisals fall under USPAP's Business Appraisal Standards, which are separate from but structurally similar to real property standards.
Which situation requires an appraiser to invoke the Departure Rule or adjust scope of work?
Answer: The client requests a desktop appraisal instead of a full interior inspection
A desktop appraisal limiting inspection scope requires explicit scope of work adjustment and disclosure of that limitation in the report.
An appraiser who observes visible signs of environmental contamination during a property inspection is ethically required to:
Answer: Disclose the observation in the report and address its potential effect on value
USPAP requires appraisers to note and address observed conditions that may affect value, including apparent environmental contamination.