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When Am I Not A USPAP Appraiser?

Discussion in 'Fannie Mae, Freddie Mac, USPAP' started by James Andreas, Sep 26, 2007.

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  1. James Andreas

    James Andreas Sophomore Member

    0
    Nov 9, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    Scenerio: Estimating Market Value for Insurance or Tax Purposes

    Was discussing with associate, and...

    Not engaged in a Federally Related assignment.
    Appraisal credential is disclosed.
    Disclose and do not comply with USPAP. (do not mislead client)
    Contract to provide a valuation service.

    Q1: Are there any USPAP issues in doing this? Obligations to comply?
    Q2: Outside USPAP, what ethical or other issues exist/are perceives?

    Thanks in advance for the feedback!

    Ref:

    My state (CA) says "The (OREA) Licensing Unit ensures that applicants for appraisal licenses meet minimum requirements for education, experience, and examination that comply with federal mandates, and ensure that only qualified persons are licensed to conduct appraisals in federally related real estate loan transactions."

    USPAP states "USPAP does not establish who or which assignments must comply...Compliance with USPAP is required when either the service or the appraiser is obligated to comply by law or regulation, or by agreement with the client or intended users. When not obligated, individuals may still choose to comply."
     
  2. Couch Potato

    Couch Potato Elite Member

    0
    Mar 15, 2004
    Professional Status:
    Certified Residential Appraiser
    State:
    North Carolina
    You will need CA appraisers for a good reply. I am always a USPAP appraiser under the laws for my licenses.
     
  3. David Wimpelberg

    David Wimpelberg Moderator Staff Member Moderator

    191
    Mar 30, 2005
    Professional Status:
    Certified General Appraiser
    State:
    New York
    Ditto Mr. Potato.

    I personally would not put myself out as an licensed appraiser then complete work that did not conform to USPAP. IMHO, that does not promote the public trust.

    With regard to these specific issues, just a couple of comments. You're probably looking for Insurable Value, not Market Value, for insurance purposes. I don't know what "Tax Purposes" refers to. You may be dealing with Federal Regulations in that case, and may have to meet whatever requirements apply, which may include a license.
     
  4. Fred

    Fred Elite Member

    0
    Jan 15, 2002
    Professional Status:
    Retired Appraiser
    State:
    Virgin Islands
    The short answer is - whenever you are not an appraiser. That said, what's a "USPAP appraiser?"
     
  5. Denis DeSaix

    Denis DeSaix Elite Member

    534
    May 16, 2005
    Professional Status:
    Certified General Appraiser
    State:
    California
    In California, as a licensed appraiser, you are subject to USPAP when it applies.
    It applies if you are hired because you are an appraiser and the assignment is an appraisal service.

    Read AO-21. Its not too ambiguous.

    Your question makes me curious, however: Why, as an appraiser, would you want to complete a real property valuation outside of USPAP?

    My question is sincere- I don't understand what that advantage would be? :shrug:
     
    Last edited: Sep 27, 2007
  6. Brian Weaver

    Brian Weaver Senior Member

    15
    Apr 16, 2005
    Professional Status:
    Gvmt Agency, FNMA, HUD, VA etc.
    State:
    Illinois
    This is right out of the California Regs:
    3542. Acceptable Categories of Experience and Criteria for Each Category
    (a) Acceptable categories of experience to meet the minimum requirements of
    Section 3541 and the criteria for each category are as follows:
    (1) Fee and staff appraisal (a real property appraisal prepared by a person
    who is employed by another, usually a lending institution or government
    agency, or who is paid a fee for the appraisal assignments he or she
    performs):
    (A) Shall be a written document;
    (B) Shall have used the entire appraisal process;
    (C) Shall have used all appraisal methods (market, cost, income)
    customarily used for a particular property type (i.e., residential,
    commercial, industrial, etc.);
    (D) Shall conform to USPAP, particularly Standards Rules 1 and 2;
    and
    (E) Analysis must be completed by the applicant.
    (2) Ad valorem tax appraisal (a real estate appraisal prepared by an
    appraiser which estimates a value that is used for property tax purposes):
     
  7. Denis DeSaix

    Denis DeSaix Elite Member

    534
    May 16, 2005
    Professional Status:
    Certified General Appraiser
    State:
    California
    Brian-

    I don't think the question was regarding applicable experience; if it was, I misunderstood it.

    I think the question is regarding, "Do I have to follow USPAP if I'm a licensed appraiser in California and giving a market value for non-FRT purposes?"

    Of course James could tell me I"m wrong?
     
  8. George Hatch

    George Hatch Elite Member

    457
    Jan 15, 2002
    Professional Status:
    Certified General Appraiser
    State:
    California
    I think your question is a licensing question rather than a USPAP question.

    USPAP is applicable whenever the individual is acting as an appraiser, regardless of what terminology of nomenclature they may be using to describe what they're doing. That's why we get so annoyed when RE brokers offer opinions of value for other than brokerage purposes without adhering to the requirements for developing and reporting opinions of value.

    You're asking at what point the OREA won't hold you responsible for adhering to USPAP. The following section was lifted from the California Code of Regulations:

    But wait, once was not enough. They repeat the applicability to USPAP in the Business and Professions Code:

    [FONT=TimesNewRomanPS-BoldMT+1]Notice that neither of the above citations note any other limitations on their jurisdiction beyond whether the individual is a licensee and whether the work or service performed is addressed in USPAP. [/FONT]​

    [FONT=TimesNewRomanPS-BoldMT+1]If you're asking if the OREA doesn't have jurisdiction over you when you're not performing federally related transactions all I can suggest is that you think about it a little. The OREA responds to complaints about their licensees, and those complaints can come in from most anywhere and involve all sorts of assignments. Appraisals for right-of-way, litigation, estate, buyer/sellers, landlord/tenant, etc.. [/FONT]​

    [FONT=TimesNewRomanPS-BoldMT+1]The greater question in my mind is if you are acting as a professional appraiser, what part of USPAP is so difficult or objectionable that you would consider avoiding adherence to it under any circumstances? [/FONT]​

    ...
     
    Last edited: Sep 27, 2007
  9. Steve Yeager

    Steve Yeager New Member

    0
    Feb 10, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    Florida
    Wouldn't USPAP trump state?
     
  10. Denis DeSaix

    Denis DeSaix Elite Member

    534
    May 16, 2005
    Professional Status:
    Certified General Appraiser
    State:
    California
    Where's the conflict between the two?
     
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