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September 20, 2008
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Fable For Our Times - in the last email newsletter
It is a satire and is not "real". Some readers
thought it was "real". My apologies.
Here's a comment from the author:
The article "A Fable For Our Times" (09-17-2008) was
written by an appraiser, and is a satirical work of
fiction meant to teach an ethical lesson, adapting
the narration and talking points for a story on the
Writer's Guild Strike published in "In These Times"
magazine. It is intended to stimulate a fresh
perspective on the appraisal profession's current
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August USPAP Q&A -
Intended users, E&O insurance, Updates
The Appraisal Standards Board (ASB) of The Appraisal
Foundation develops, interprets, and amends the
Uniform Standards of Professional Appraisal Practice
(USPAP) on behalf of appraisers and users of
appraisal services. The USPAP Q&A is a form of
guidance issued by the ASB to respond to questions
raised by appraisers, enforcement officials, users
of appraisal services and the public to illustrate
the applicability of USPAP in specific situations
and to offer advice from the ASB for the resolution
of appraisal issues and problems. The USPAP Q&A may
not represent the only possible solution to the
issues discussed nor may the advice provided be
applied equally to seemingly similar situations.
USPAP Q&A does not establish new standards or
interpret existing standards. USPAP Q&A is not part
of USPAP and is approved by the ASB without public
exposure and comment.
Addressees, Clients, And Intended Users
Question: If the party to whom an appraisal report
is addressed is the client and is also the only
intended user, does USPAP require the report to
state the intended user by name or type?
Response: While USPAP requires all reports to state
the client and any other intended user(s), USPAP
does not dictate how this should be done. When there
is only a single intended user (the client), a
simple statement as part of the salutation may be
sufficient; however, in other cases, it may not be
adequate. The report must clearly and accurately set
forth the appraisal in a manner that will not be
misleading and must contain sufficient information
to enable intended users to understand the report
The purpose of reporting requirements related to
client and intended user identification is to: (1)
ensure that the client and any other intended users
can recognize their relationship to the assignment
and report; and (2) ensure that unintended users
will not be misled by notifying them that they are
neither the client nor an intended user.
STATEMENT 9, Identification of Intended Use and
Intended Users, provides extensive information on
this topic in addition to several examples of
statements that may be appropriate for inclusion in
a report, such as the following:
This report is intended for use only by (identify
the client) and (identify any other intended users
by name or type). Use of this report by others is
not intended by the appraiser.
Errors and Omissions Insurance
Question: Does USPAP require appraisers to
be covered by Errors and Omissions (E&O) insurance?
Response: USPAP does not address E&O insurance.
However, if an appraiser is required to have E&O
insurance as a matter of law or regulation, he or
she must comply with that requirement under the
COMPETENCY RULE which requires recognition of, and
compliance with, laws and regulations that apply to
the appraiser or the assignment.
Appraisal Update With No Change In Value
Question: I was recently contacted by a
client for whom I had previously completed an
appraisal. The client asked if I could simply tell
them that there have been no changes in the market
since the time of my appraisal, and that the value
of the property remains the same. Am I permitted to
do this under USPAP?
Response: Yes. However, it must also be understood
that an appraiser making a determination that the
value of a property has not changed is performing an
appraisal as defined in USPAP. The Comment to the
definition of "Appraisal" states:
An appraisal must be numerically expressed as a
specific amount, as a range of numbers, or as a
relationship (e.g., not more than, not less than) to
a previous value opinion or numerical benchmark
(e.g., assessed value, collateral value). (Bold
added for emphasis)
In addition, the appraiser is obligated to comply
with the reporting requirements of USPAP. The
request from the client should be treated as a new
assignment, which could be completed in accordance
with Advisory Opinion 3, Update of a Prior
For further information regarding USPAP Q&A, please
John S. Brenan, Director of Research and Technical
The Appraisal Foundation
1155 15th Street, NW, Suite 1111
Washington, DC 20005
(202) 347-7727 fax
NAR appraisal blog
Here's an excerpt from a recent posting:
"At yesterday's Appraisal Standards Board public
meeting in Chicago, one of the audience members
inquired about an APO, which is apparently a product
that some appraisers are advocating so that the
compete with brokers and their BPO's or Broker Price
opinions. Many in the aduience thought that we
already has such a product and that it was called an
"The biggest part of the Wall Street meltdown is as
a result of poor mortgage lending practices,
including a variety of appriasal products that were
something less than an URAR appraisal."
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phone: 800-839-0227//fax: 800-839-0014
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