A homeowner calls asking about the appraisal an appraiser completed on that home last month for a lender. What governs the appraiser's response?
Correct Answer
A) Confidentiality — the lender, not the homeowner, is the client
Why this is correct: Confidentiality under the Ethics Rule is owed to the client, who is the party that engaged the appraiser. In a typical lender assignment, the lender is the client. The homeowner/borrower is not the client, so the appraiser cannot disclose assignment results without the client's authorization. Why the other choices are wrong: There is no general freedom of information right for the homeowner. The report does not become public after loan closing. Courtesy does not override the confidentiality duty to the client. Exam tip: The client is who engaged you, not necessarily who paid. Protect client confidentiality strictly.
Why This Is the Correct Answer
Confidentiality runs to the client, which is the lender that engaged the appraiser. The homeowner is not the client and the appraiser may not disclose assignment results to them.
Why the Other Options Are Wrong
Option B: Freedom of information, since the owner occupies the property
Freedom of information applies to government records. A private appraisal report is not one, and occupancy confers no right of access.
Option C: The report is public once the loan closes
Loan closing does not make an appraisal report public. The confidentiality obligation continues.
Option D: Courtesy requires providing a full copy on request
Courtesy does not override a USPAP obligation. Release requires client authorization.
The Client Is Who Hired You
The Client Is Who Hired You, not who lives there and not who paid at closing.
How to use: Decline politely and refer them to the lender. The lender can release it; you cannot.
Exam Tip
Consumer protection rules generally require the lender to give the borrower a copy, which is why the referral is a genuine answer rather than a brush-off.
Common Mistakes to Avoid
- -Treating the property owner as the client
- -Assuming recording or closing makes the report public
- -Providing partial information such as the value figure alone
Concept Deep Dive
Analysis
Confidentiality under USPAP runs to the client, and the client is whoever engaged the appraiser — here the lender, not the homeowner whose property was appraised. Owning or occupying the property does not make someone the client, and the distinction routinely surprises homeowners who paid for the appraisal through their closing costs. The appraiser may not disclose confidential information or assignment results to anyone other than the client, persons specifically authorised by the client, state enforcement agencies, and certain third parties as may be authorised by due process of law. So the correct response is to decline politely and direct the homeowner to the lender, who can release a copy if it chooses — and under separate consumer protection rules a lender generally must provide the borrower a copy in any case. What the appraiser must not do is treat public recording, occupancy, or courtesy as overriding the obligation.
Background Knowledge
USPAP's Confidentiality section prohibits disclosure of confidential information and assignment results except to the client, parties authorised by the client, state enforcement agencies, and third parties authorised by due process of law.
Real-World Application
An appraiser receiving a homeowner's call explains the confidentiality obligation, declines to discuss the report, and directs them to their lender.
More USPAP Questions
Which type of appraisal report may contain the appraiser's analyses, opinions, and conclusions but is intended for use by the client only?
How long must an appraiser retain the workfile for an appraisal assignment under USPAP?
If an appraiser uses a hypothetical condition that the subject property is 10% larger than it actually is, this must be:
Under Standard 1, when developing a real property appraisal, an appraiser must:
An appraiser accepts an assignment to appraise a specialized industrial property but has never appraised this property type before. To comply with the Competency Rule, the appraiser:
According to the Scope of Work Rule, the scope of work must be appropriate to the:
According to Standard 1, when developing an opinion of market value, an appraiser must analyze:
A lender emails: 'We need at least $450,000 to make this loan work — can you take the assignment?' Accepting on that basis is:
An appraiser is developing an opinion of market value for a 20-unit apartment building. The appraiser finds three comparable sales with the following information: Sale 1: 18 units, sold for $1,800,000; Sale 2: 22 units, sold for $2,200,000; Sale 3: 24 units, sold for $2,280,000. What is the average price per unit for these comparables?
In developing a scope of work, an appraiser must consider all of the following factors EXCEPT:
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An appraiser receives an assignment to appraise a property type they have never appraised before, but they have extensive experience in the geographic area. Under the Competency Rule, the appraiser may:
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When an appraiser uses an extraordinary assumption in an assignment, the assumption must be: