Confidential information under USPAP includes:
Correct Answer
B) Client-identified confidential information and assignment results
Why this is correct: USPAP defines confidential information to include (1) information the client specifically identifies as confidential, and (2) assignment results (e.g., the appraiser's opinions and conclusions) themselves, which cannot be disclosed to anyone other than the client and certain specifically authorized parties without client permission. Why the other choices are wrong: Not every single fact learned is confidential; only the defined categories are. Confidentiality is not limited to written communications or information marked in writing; it can be oral and is defined by the nature of the information. Exam tip: Confidential info = what the client says is secret + your appraisal results. Protect both.
Why This Is the Correct Answer
Option B is right because it names both protected categories - what the client identifies as confidential and the assignment results themselves. Those two together capture what an appraiser may not disclose without authorization, and the second is the one appraisers most often overlook, since a value conclusion feels like the appraiser's own work product rather than something belonging to the client relationship. Note the qualifier inside the definition: client-identified information is confidential where it is not available from any other source, which is why a recorded deed handed over by a client does not become secret. Information classified as confidential or private by applicable law is protected independently of anything the client says.
Why the Other Options Are Wrong
Option A: Every single fact the appraiser learns during any assignment
A sweeping rule covering every fact learned would make it impossible to discuss recorded sales, public assessment data, or anything else the appraiser gathers from open sources, and it would conflict with the definition's own exclusion of information available elsewhere. Confidentiality is defined, not unlimited. An appraiser operating on this belief would be unable to describe the market at all.
Option C: Only written communications from the client
Nothing in the definition limits protection to written communications; a client can identify information as confidential when providing it in any form, including orally at an inspection or on a call. Restricting the concept to documents would create an easy route around it. Form is irrelevant; identification and unavailability elsewhere are what matter.
Option D: Only information marked confidential in writing
There is no requirement that information be marked confidential in writing, and imposing one would leave a client's sensitive disclosures unprotected because of a missing label. The definition asks whether the client identified it as confidential when providing it, which is a question of communication rather than of stamps. It also ignores the second prong, which protects information classified as confidential or private by law regardless of what anyone says.
What they told you plus what you concluded
Two buckets you cannot spill. What the client told you in confidence and that nobody else has. And what you concluded - your assignment results. Everything else is either public or governed by law, not by the client's preference.
How to use: For any confidentiality question, sort the item into client-identified information, assignment results, legally protected information, or ordinary public data. The first three are protected; the fourth is not. Then check the option against the permitted-recipient list before allowing any disclosure.
Exam Tip
Memorize the permitted recipients - the client, parties the client specifically authorizes, state appraiser regulatory agencies, third parties authorized by due process of law, and a duly authorized professional peer review committee - because items often test whether a particular recipient is on it.
Common Mistakes to Avoid
- -Disclosing assignment results to a party who is not the client
- -Treating all information learned during an assignment as confidential
- -Requiring a written label before protecting client information
- -Overlooking that the obligation continues after the assignment ends
Concept Deep Dive
Analysis
This question tests the Confidentiality section of the ETHICS RULE and the term it turns on. USPAP defines confidential information narrowly and precisely: information identified by the client as confidential when providing it to the appraiser and that is not available from any other source, or information classified as confidential or private by applicable law or regulation. The section then imposes a second, separate obligation - the appraiser must not disclose confidential information or assignment results to anyone other than the client, parties the client specifically authorizes, state appraiser regulatory agencies, third parties as may be authorized by due process of law, or a duly authorized professional peer review committee. So two categories are protected: confidential information as defined, and assignment results, which are the appraiser's own opinions and conclusions. Appraisers who assume everything they learn is confidential over-restrict themselves, and those who assume only labeled documents are protected under-protect the client, so the definition's boundaries matter in both directions.
Background Knowledge
You need the USPAP definition of confidential information with both prongs - client-identified and not available from any other source, or classified as confidential or private by applicable law or regulation - together with the Confidentiality section's prohibition on disclosing confidential information or assignment results and its list of permitted recipients. You should also know that the obligation survives the assignment and that data privacy laws applicable to the assignment can expand what must be protected.
Real-World Application
An appraiser who valued a property for a bank is later called by the property owner's agent asking what the value came in at. Because the assignment results belong to the client relationship, she declines and refers the caller to the bank, even though the owner is the subject of the appraisal and paid the fee indirectly.
More USPAP Questions
Which statement best defines a hypothetical condition under USPAP?
According to the Competency Rule, if an appraiser lacks the knowledge and experience to complete an assignment competently, which action is NOT acceptable?
An appraiser runs only the sales comparison approach on a standard tract home and omits the cost and income approaches. Under Standard 1 this is:
A value opinion for a subdivision as if fully built out two years from now is what kind of assignment, and what does it require?
A hypothetical condition differs from an extraordinary assumption in that a hypothetical condition:
An appraiser must disclose in the certification whether they have:
A client-imposed requirement — 'use only comps from our approved list' — is best described as:
Under Standard 1, when developing a real property appraisal, an appraiser must:
The certification required by Standards Rule 2-3 must be signed by:
According to Standard 1, when developing an opinion of market value, an appraiser must analyze:
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