The effective date of an appraisal differs from the report date in that the effective date:
Correct Answer
B) Establishes the point in time to which the value opinion applies
Why this is correct: The effective date is the specific date to which the appraiser's opinion of value applies, based on market conditions at that time. The report date is when the appraisal report is issued. Why the other choices are wrong: "Is always the same calendar day the appraiser inspected the property" is false; the inspection date and effective date can differ. "Marks the deadline by which the client must act on the conclusion" is not a function of the effective date. "Is set by the lender to match the anticipated loan closing schedule" confuses the effective date with a closing date; the appraiser sets the effective date based on assignment conditions. Exam tip: The value opinion is 'as of' the effective date. The report is 'as of' the report date. Always state both clearly.
Why This Is the Correct Answer
Why this is correct: The effective date is the specific date to which the appraiser's opinion of value applies, based on market conditions at that time. The report date is when the appraisal report is issued. Why the other choices are wrong: "Is always the same calendar day the appraiser inspected the property" is false; the inspection date and effective date can differ. "Marks the deadline by which the client must act on the conclusion" is not a function of the effective date. "Is set by the lender to match the anticipated loan closing schedule" confuses the effective date with a closing date; the appraiser sets the effective date based on assignment conditions. Exam tip: The value opinion is 'as of' the effective date. The report is 'as of' the report date. Always state both clearly.
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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