During an appraisal, the appraiser discovers the borrower is a public figure. A reporter calls asking to confirm 'anything interesting.' The appraiser may say:
Correct Answer
A) Only that no comment can be made, absent client authorization or legal process
This question tests the appraiser's duty of confidentiality under USPAP's Ethics Rule, which protects all confidential assignment information and results, regardless of the client's public status. Why this is correct: The correct choice, 'Only that no comment can be made, absent client authorization or legal process,' is mandated by the confidentiality obligation. An appraiser must not disclose confidential information or assignment results without the client's permission or a legal requirement (e.g., a subpoena). The client's fame does not waive this duty. Why the other choices are wrong: Disclosing 'General impressions of the house, since opinions are not data' is wrong because confidential information includes opinions and analyses formed during the assignment. Sharing 'Anything already visible from the street' is wrong because the duty extends beyond physical observations to include all assignment-specific information. Revealing 'The final value figure only, since it will appear in the public records anyway' is wrong because the appraiser's duty exists independently of future public recording; the appraiser is not the source for that disclosure. Exam tip: Remember that confidentiality in appraisal is absolute unless the client authorizes disclosure or the law compels it. The public status of a property or client is irrelevant.
Why This Is the Correct Answer
Declining to comment absent client authorization or legal process tracks the confidentiality rule exactly and leaves both permitted doors open without opening them unilaterally. It also protects the appraiser from being drawn into a conversation where a single confirmation reveals more than intended. Reporting the contact to the client is the natural next step, since the client is the one who can authorize disclosure if it wants to. Choice A is the only answer that says nothing about the assignment.
Why the Other Options Are Wrong
Option B: General impressions of the house, since opinions are not data
Opinions formed during an assignment are assignment results and analyses, which is precisely what the rule protects, so calling them impressions rather than data changes nothing. A characterization of the house is also a step toward the value conclusion in the mind of any reporter. The distinction the option draws between facts and opinions does not appear anywhere in the confidentiality obligation.
Option C: Anything already visible from the street
That something is visible from the street means the reporter can go look; it does not authorize the appraiser to become a source. Once the appraiser confirms details as the appraiser, he is disclosing that he was engaged on the property and lending professional weight to the description. The public visibility of a feature does not make the appraiser's knowledge of it non-confidential in the context of the assignment.
Option D: The final value figure only, since it will appear in the public records anyway
The value opinion is the core assignment result and the most clearly protected item on the list, and a sale price that may later be recorded is a different fact from the appraiser's opinion of value. Anticipating a future public record does not create present authorization, and the recorded price often will not match the appraised value in any case. Being the first to release it is exactly what the rule forbids.
Client, Authorized, Regulator, Court
Four doors and no windows. The client, someone the client names, the state regulator, and lawful process. A reporter is not standing at any of the four, no matter how interesting the house is.
How to use: Run every inquiry against the four doors before answering anything. If the caller is not behind one, the answer is a polite no comment followed by a call to the client.
Exam Tip
Confidentiality questions punish partial disclosure. If an option lets you say a little, it is wrong; the compliant answer is always to say nothing about the assignment.
Common Mistakes to Avoid
- -Believing that publicly observable facts are outside the confidentiality duty
- -Confirming the existence of an engagement while declining to give details
- -Assuming the duty ends when the report is delivered or the loan closes
Concept Deep Dive
Analysis
The Confidentiality section of the Ethics Rule bars an appraiser from disclosing confidential information or assignment results to anyone other than the client, persons the client specifically authorizes, state appraiser regulatory agencies, third parties as authorized by due process of law, and a duly authorized professional peer review committee. Assignment results include the opinion of value and the analyses supporting it, and confidential information includes what the client provided that is not otherwise public along with the fact of the engagement itself in most contexts. Nothing in that list contains reporters, neighbors, agents, or the borrower's family, and no exception opens because the subject is newsworthy or because the questioner already seems to know something. The only safe response is a refusal to comment paired with a referral to the client, and the appraiser should tell the client that the call happened. Note also that state privacy and financial information laws add obligations of their own on top of USPAP, so this is one area where the professional floor is not the whole story.
Background Knowledge
You need the Confidentiality section of the Ethics Rule, the closed list of parties to whom disclosure is permitted, and the definitions of confidential information and assignment results. You should also know that these duties survive delivery of the report, that the client can authorize disclosure but the appraiser cannot self-authorize, and that state privacy and financial data laws may impose additional restrictions.
Real-World Application
An appraiser who valued a well-known athlete's home receives a call from a business reporter. He states that he cannot confirm or discuss any engagement, gives no detail, emails the lender client a summary of the call the same afternoon, and adds the note to the workfile.
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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