An appraiser receives a request to modify a completed appraisal report to increase the value conclusion by $15,000 to meet the contract price. The appraiser should:
Correct Answer
D) Refuse to modify the report and document the request
Why this is correct: The USPAP Ethics Rule mandates that an appraiser must maintain independence and objectivity. A request to alter a value conclusion solely to meet a contract price is an attempt to compromise that independence. The correct action is to refuse the modification and thoroughly document the request, as stated in the original explanation. Why the other choices are wrong: Modifying the report but noting the client's request ("Modify the report but note the change was requested by the client") still violates the requirement for an independent value conclusion. Withdrawing from the assignment immediately ("Withdraw from the assignment immediately") is not the required first step; the appraiser must first refuse the improper request. Modifying the report if additional comparable sales support the higher value ("Modify the report if additional comparable sales support the higher value") is incorrect because the request itself is unethical; the appraiser should not re-analyze data under the pressure of a predetermined value. Exam tip: Any request to change a value to hit a specific number is a red flag. Your duty is to refuse, document, and maintain independence.
Why This Is the Correct Answer
Option B correctly follows USPAP Ethics Rule requirements for maintaining appraiser independence. When faced with requests to change value conclusions to meet predetermined amounts, appraisers must refuse such requests to preserve the integrity of their professional opinion. Documentation of the request is crucial for potential regulatory reporting and protects the appraiser by creating a record of the attempted compromise. This approach maintains compliance with professional standards while protecting both the appraiser's license and the public trust.
Why the Other Options Are Wrong
REFUSE and RECORD Rule
Remember 'REFUSE and RECORD' - when clients request value changes to meet predetermined amounts, always REFUSE the request and RECORD (document) the attempt for regulatory protection and professional compliance.
How to use: When you see any question about client pressure to change values, immediately think 'REFUSE and RECORD' to identify the correct response that maintains USPAP compliance and professional integrity.
Exam Tip
Questions about client pressure to modify values will always have the correct answer involving refusal and documentation - never choose options that suggest accommodating client requests to change value conclusions.
Common Mistakes to Avoid
- -Thinking additional comparable sales justify changing values to meet client requests
- -Believing that noting client requests in the report makes value modifications acceptable
- -Assuming immediate withdrawal is always required when facing inappropriate client requests
Concept Deep Dive
Analysis
This question tests understanding of USPAP Ethics Rule regarding appraiser independence and the prohibition against predetermined value conclusions. The scenario presents a clear violation attempt where a client requests modification of a completed appraisal to meet a specific value target. USPAP strictly prohibits appraisers from developing, reporting, or communicating appraisal services in a misleading or fraudulent manner, which includes changing conclusions to meet client expectations rather than market evidence. The appraiser's professional integrity and independence must be maintained regardless of client pressure or financial incentives.
Background Knowledge
USPAP Ethics Rule establishes fundamental principles requiring appraisers to perform assignments with impartiality, objectivity, and independence, free from accommodation of personal interests or client pressure. The Conduct section specifically prohibits developing, reporting, or communicating appraisal services in a misleading or fraudulent manner, which includes modifying conclusions to meet predetermined values.
Real-World Application
In practice, appraisers frequently face pressure from lenders, real estate agents, or borrowers to 'hit' contract prices, especially in competitive markets. Professional appraisers must resist this pressure, document such requests, and maintain independence to preserve public trust and avoid regulatory sanctions or license revocation.
More USPAP Questions
An appraiser is analyzing three comparable sales with the following data: Sale 1: $350,000 with +$10,000 adjustments; Sale 2: $340,000 with -$5,000 adjustments; Sale 3: $360,000 with -$15,000 adjustments. What are the adjusted sale prices?
A lender orders an appraisal for a $300,000 residential loan. After receiving the appraisal, the loan officer contacts the appraiser requesting that certain language be changed to better support the loan approval. This scenario represents a violation of:
How often must appraisers complete continuing education to maintain their license or certification?
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