An appraiser receives a third-party AVM estimate and has not yet assessed or adopted it. How should that received output be treated?
Correct Answer
D) As information to evaluate before forming the appraiser’s own results.
The received estimate is information for the appraiser to evaluate. It does not automatically become the appraiser’s own supported opinion or satisfy a particular lender requirement. The appraiser decides whether and how the model output can reasonably support the assignment and remains responsible for the resulting analysis and conclusions.
Why This Is the Correct Answer
Option D is correct because a received AVM estimate is information for the appraiser to evaluate before forming the appraiser's own assignment results. It does not automatically become the appraiser's supported opinion. In developing a real property appraisal, the appraiser must collect, verify and analyze all information necessary for credible assignment results.
Why the Other Options Are Wrong
Option A: As the appraiser’s completed appraisal, because the vendor is approved.
Option A is wrong because an approved vendor does not make the AVM estimate the appraiser's completed appraisal. The appraiser must develop the appraisal, and vendor approval does not change who forms the opinion.
Option B: As proof that the lender’s evaluation requirement is satisfied.
Option B is wrong because receiving an AVM estimate is not proof that the lender's evaluation requirement is satisfied. Whether a requirement is met depends on the lender's own criteria, not on the appraiser receiving an output.
Option C: As an assignment result the appraiser is required to adopt unchanged.
Option C is wrong because the appraiser is not required to adopt an AVM estimate unchanged as an assignment result. The appraiser decides whether and how the output can reasonably support the assignment.
Received is not adopted
An AVM number you receive is input, not your opinion. You evaluate it before it can support anything.
How to use: Use this when a question asks how an appraiser should treat a vendor's model estimate.
Exam Tip
Pick the answer that keeps the appraiser evaluating and deciding. Answers that make the output automatic, mandatory or proof of compliance are wrong.
Common Mistakes to Avoid
- -Treating a vendor estimate as the appraiser's completed appraisal
- -Believing the appraiser must adopt the AVM value
- -Assuming AVM output automatically satisfies a lender requirement
Concept Deep Dive
Analysis
This question tests how an appraiser should treat a third-party AVM estimate that has not yet been assessed. Received output is information to evaluate, not the appraiser's own opinion or proof that a lender requirement is satisfied. The appraiser remains responsible for deciding whether and how it supports the assignment.
Background Knowledge
AVM output is a statistical estimate produced by a vendor's model. Appraisers may consider such output as information, but USPAP places responsibility for the analysis and conclusions on the appraiser.
Real-World Application
A lender attaches an AVM value to an appraisal order. The appraiser notes it, checks it against verified comparable sales, finds the AVM missed a recent major addition, and reaches her own supported conclusion.
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