California Real Estate Practice Exam

An appraiser would NOT be in violation of the USPAP if he:

1. Accepts an appraisal assignment, knowing that he is not fully qualified to handle the assignment

2. Accepts an appraisal fee based upon a percentage of the value estimate

3. Accepts an appraisal fee for service on a property in which he has an interest, a fact which has been disclosed to his client in writing

4. Pays people to refer clients to him

The correct answer is: Accepts an appraisal assignment, knowing that he is not fully qualified to handle the assignment

The correct response highlights a crucial aspect of the Uniform Standards of Professional Appraisal Practice (USPAP) concerning professional qualifications. An appraiser operates under professional ethics and standards, which include the principle of competency. When an appraiser accepts an assignment, they must ensure they possess the requisite knowledge and expertise to perform the appraisal competently. Accepting an assignment despite knowing that they lack the qualifications would violate these standards. By contrast, the other options represent actions that can lead to violations of USPAP. Accepting fees based on a percentage of the appraised value can incentivize appraisers to inflate values, which is against ethical standards. Accepting fees for appraisals on properties where the appraiser has a vested interest, even if disclosed, raises questions about objectivity and impartiality, heavily scrutinized under USPAP. Lastly, paying for referrals undermines the ethical integrity of the appraisal profession, which is not endorsed by USPAP. Thus, the choice that aligns with USPAP compliance is when an appraiser does not accept assignments outside their qualifications.