An appraiser is asked to review an assignment where an AVM supplied the value. What does the review examine?
Correct Answer
C) Whether the work under review is credible
Why this is correct: A review appraisal evaluates the credibility and appropriateness of the work under review, including whether reliance on an AVM was reasonable and whether sufficient analysis supports the conclusion. Why the other choices are wrong: "Whether the model vendor is federally approved" may be relevant but is not the core review focus. "Whether the model returned the highest available figure" is not a standard; the review assesses credibility, not outcome maximization. "Whether the reviewer would have used that model" is subjective; the standard is whether the work is credible. Exam tip: A review focuses on the credibility of the work reviewed, not on whether you agree with every choice.
Why This Is the Correct Answer
Option C states the standard: the review examines whether the work under review is credible, meaning worthy of belief given its intended use and scope of work. That test governs regardless of the tools the original appraiser used, so the reviewer evaluates whether reliance on the model was reasonable and adequately supported. If the reviewer also develops an opinion of value, additional development and reporting requirements attach, but the core review question remains the quality of the work reviewed.
Why the Other Options Are Wrong
Option A: Whether the model vendor is federally approved
There is no federal roster of approved AVM vendors for a reviewer to check. Federal AVM rulemaking places quality-control obligations on the institutions that use models rather than granting approval to the models themselves, and an institution's internal policy is not the USPAP review question. The distractor works because bank-facing regulation feels adjacent to appraisal standards.
Option B: Whether the model returned the highest available figure
Nothing in USPAP asks whether a value is the highest obtainable; the standard is credibility, not maximization. Grading a model by whether it produced the largest number is advocacy, and a reviewer who applied that test would be adopting the bias the standards forbid.
Option D: Whether the reviewer would have used that model
A reviewer's personal methodological preference is not the benchmark. Two competent appraisers can choose different tools and both produce credible results, so the review asks whether the choices made were reasonable and supported, not whether the reviewer would have made them. Substituting preference for that test turns a review into a second appraisal.
Credible, Not Congruent
The reviewer's yardstick is one word: credible. Not correct to the dollar, not congruent with what I would have done, not conservative, not maximal. Say 'C for credible' before you read the options.
How to use: When a review stem offers one option containing the word credible and three that describe agreement, approval, or outcome, choose credible unless the stem specifically asks what happens when the reviewer develops an opinion of value.
Exam Tip
Watch for review stems that quietly ask the reviewer to develop a value; that triggers extra requirements. If the stem does not say so, stay with quality of the work under review.
Common Mistakes to Avoid
- -Redoing the appraisal instead of reviewing it
- -Judging the work by today's data rather than the effective date and the information then available
- -Treating an AVM figure as an appraisal that can stand without appraiser analysis
Concept Deep Dive
Analysis
This tests the purpose of an appraisal review assignment. Under USPAP's appraisal review standard, the reviewer develops an opinion about the quality of another appraiser's work: whether the analyses, opinions, and conclusions in the work under review are appropriate and reasonable, judged in the context of that work's own intended use and scope of work. The presence of an automated valuation model does not change the question; it simply adds another analytical step to test. An AVM output is a tool rather than an appraisal, so the reviewer asks whether relying on it was appropriate here, whether the model's data actually covered this subject and market, and whether the appraiser supported the reliance with sufficient analysis.
Background Knowledge
Know that a review assignment develops an opinion about the quality of other appraisal work, judged against the intended use and scope of work of the work under review. Know also that an AVM produces a statistical estimate rather than an appraisal, and that model output is data the appraiser must analyze and support.
Real-World Application
A credit union asks a certified appraiser to review an evaluation whose value came from a vendor AVM with a wide confidence interval on a rural property with few nearby sales. The review report explains that thin model data made reliance unsupported for this subject and identifies the additional analysis that would have been needed.
More Emerging Methods Questions
How does an alternative inspection method affect the appraiser's disclosure obligations?
A collector's photographs show a condition the appraiser believes needs specialist assessment. What is the appropriate step?
What responsibility does an appraiser retain for an error originating in a third-party database?
Under current USPAP guidance, what is the output of an automated valuation model before an appraiser analyzes it?
Which assignment type still requires the appraiser to develop an opinion of value?
A model returns an estimate far from the appraiser's own conclusion. What is the appropriate response?
What does it mean that a tool cannot comply with USPAP?
Why is the date a data extract was pulled worth recording in the workfile?
A desktop appraisal is best described as an assignment completed how?
How does the scope of work rule apply when a lender requests a desktop assignment?
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