NAR_grey_logo-01

Appraisal Foundation FAQs

2010-01: ETHICS RULE – CONDUCT

Question: If I have appraised a property multiple times within the previous three years, do I have to disclose the number of appraisal services? (e.g., “I have appraised the subject property three times during the previous three years.”)

Response: Yes. Each prior service must be disclosed to the client and included in the report certification. This disclosure is similar to when an appraiser has any current or prospective interest in the subject property or the parties involved, which requires that each interest be specified. Therefore, each service must be disclosed to the client and appear in the certification. (See lines 231-241 in the 2010-11 edition of USPAP)

2010-02: ETHICS RULE – CONDUCT

Question: If I have performed a service other than appraisal practice, such as acting as a general contractor within the prior three years, do I have to describe the specific service or merely state a service was performed?
Response: You must disclose to the client the type of prior service you performed regarding the property and this must be included in the report certification. This disclosure is not limited to services provided as part of appraisal practice. Therefore, each service must be disclosed to the client and appear in the certification.

2010-03: ETHICS RULE – CONDUCT

Question: The Comment to the Conduct section of the ETHICS RULE states, in part, “If an appraiser has agreed with a client not to disclose that he or she has appraised a property, the appraiser must decline all subsequent assignments that fall within the three-year period.” Does this really mean that the appraiser could not be engaged by this same client, on this property, within the three-year period?

Response: Yes. The agreement not to disclose that he or she has appraised the property is between an appraiser and the client. It is possible that a qualified legal opinion might conclude that a confidentiality agreement between an appraiser and a client does not preclude disclosure between the same parties. However, the ASB is not qualified to make such a determination. Without such a legal opinion, the requirement precludes an appraiser from disclosing the prior service and from appraising the property again during this three-year disclosure period.

However, there is nothing that prohibits a client and an appraiser from modifying the prior agreement to allow disclosure. If the confidentiality agreement is amended, the disclosure could be made and an appraisal could be completed for the same client. It must be made clear that if a client releases an appraiser from such a confidentiality agreement, services performed within the previous three-year period must be disclosed in the certification of the subsequent report, even if the client is the same for both assignments.

2010-04: ETHICS RULE – CONDUCT

Question: I am a staff appraiser for a company and only complete appraisals for my employer’s (the company’s) internal use. Am I required to inform the company that I have previously completed an appraisal within the three-year period when the company is already aware of it?

Response: If you consistently correspond with the same person in the company when completing subsequent assignments regarding the same property, the risk of misleading that person is probably minimal. However, your prior services must still be disclosed. When you are working with the same person and they understand your professional responsibilities, it is unlikely this will be a problem.

It is also possible that the specific person you deal with from one instance to the next may change. In this case, the new contact must certainly be informed if you have performed services regarding the subject property within the last three years.
While it is not included in your question, there is also the possibility that you may have performed services regarding that property for a different client within the three-year period, or performed another type of service.

2010-05: ETHICS RULE – CONDUCT

Question: I am aware of the new disclosure requirements in the Conduct section of the ETHICS RULE for the 2010-11 edition of USPAP that requires me to disclose any services I performed regarding the subject property within the prior three years. If I have not performed any such services, am I required to make that disclosure as well?
Response: No. USPAP does not specifically require disclosure when no prior services were performed by the appraiser within the last three years.


EDITORIAL NOTE: Beginning with this edition, the ASB will be publishing USPAP Q&As on an “as needed” basis rather than monthly basis. With each publication, the individual questions and responses will have a numeric reference associated with the year and order of their publication.

For the reader’s current benefit, each Q&A published under the new numbering system will be listed with the specific section where it would be placed in the Frequently Asked Questions section of the next edition of the USPAP document.

The USPAP Q&A is posted on The Appraisal Foundation website (www.appraisalfoundation.org). The ASB compiles the USPAP Q&A into the USPAP Frequently Asked Questions (USPAP FAQ) for publication with each edition of USPAP. In addition to incorporating the most recent questions and responses issued by the ASB, the USPAP FAQ is reviewed and updated to ensure that it represents the most recent guidance from the ASB. The USPAP Frequently Asked Questions can be purchased (along with USPAP and USPAP Advisory Opinions) by visiting the “Foundation Store” page on The Appraisal Foundation website
(https://commerce.appraisalfoundation.org ).

Comments
  1. Rory Campbell

    I’m wondering: if I have a client who has hired me to do an appraisal in a disputed matter, must I disclose that this client has retained me to do several other appraisal jobs (and thus I have an “interest” in that employment relationship)?

    Thank you.

  2. I have been asked numerous times, “What constitutes a complex appraisal”?

    I would like to reply that the definition can be found in the F.A.Q.s. of USPAP.

  3. I have been asked numerous times, “What constitutes a complex appraisal”?

    I would like to reply that the definition can be found in the F.A.Q.s. of USPAP.

    It seems some States have different definitions.

    Can we clear that up?

ADD YOUR COMMENT