A borrower receives a copy of an appraisal to satisfy a disclosure requirement but was not identified by the appraiser as an intended user. Does receipt alone make the borrower an intended user under USPAP?
Correct Answer
D) No; intended users are identified by the appraiser with the client
An intended user is the client and another party identified by name or type as a user by the appraiser based on communication with the client at the time of the assignment, subject to report-option requirements. Receiving a copy to satisfy a disclosure requirement does not automatically confer intended-user status. Actual legal rights and permitted disclosure are separate from that USPAP identification.
Why This Is the Correct Answer
Option D is correct because USPAP defines intended users as the client and any other party identified, by name or type, as users of the report by the appraiser, based on communication with the client at the time of the assignment. USPAP also states that a party receiving a copy of a Restricted Appraisal Report to satisfy disclosure requirements does not become an intended user. The borrower here was not identified, so receipt alone does not make the borrower an intended user.
Why the Other Options Are Wrong
Option A: Yes; a party later given a copy becomes an intended user
Option A says a party later given a copy becomes an intended user. Intended users are identified at the time of the assignment through communication with the client, so later receipt of a copy does not confer that status.
Option B: Yes; owning the subject property makes the borrower an intended user
Option B says owning the subject property makes the borrower an intended user. Ownership is not the test; only parties the appraiser identifies with the client as users are intended users.
Option C: No, unless the lender charged the borrower a fee for the copy
Option C says the borrower is not an intended user unless the lender charged a fee for the copy. Payment for a copy has no role in the definition; identification by the appraiser based on communication with the client decides it.
Identified, not just received
Intended users are chosen at engagement through the client, not created by who later receives a copy.
How to use: Use this when a stem describes a party who obtains the report after the fact.
Exam Tip
Separate who receives a report from who the appraiser identified as an intended user; the two are not the same.
Common Mistakes to Avoid
- -Treating every report recipient as an intended user
- -Assuming the property owner is automatically an intended user
- -Confusing a legal right to a copy with intended-user status
Concept Deep Dive
Analysis
This question tests how intended users are identified under USPAP. Intended users are the client and any other parties identified by the appraiser, by name or type, based on communication with the client at the time of the assignment. Receiving a copy later to satisfy a disclosure requirement does not create intended-user status.
Background Knowledge
Identifying intended users is part of problem identification and shapes the scope of work and reporting. A party may legally receive a copy of an appraisal, for example under lending disclosure rules, without becoming an intended user under USPAP. Legal rights to receive a copy are separate from intended-user status.
Real-World Application
A lender provides a borrower with a copy of the appraisal as required by lending rules. The appraiser identified only the lender as the intended user, so the borrower's receipt of the copy does not make the borrower an intended user.
More USPAP Questions
Under USPAP, what are assignment results?
The certification required by Standards Rule 2-3 must be signed by:
Under 2024 USPAP, which statement correctly combines the requirements for an oral real property appraisal report and its workfile?
An appraiser accepts an assignment involving a property type the appraiser has valued once before, years ago. Competency requires:
A Certified General appraiser is asked to value a specialized industrial property for the first time. The appraiser knows a competency gap exists before agreeing to the assignment. What is required if the appraiser proceeds?
Under 2024 USPAP Standard 1, which listed assignment element must be identified in developing a real property appraisal?
An appraiser provided an appraisal of the same property for another client 18 months ago. No confidentiality obligation prevents disclosing the fact of that service. Before agreeing to a new assignment, the appraiser must:
According to USPAP, what is the primary purpose of the Ethics Rule?
An appraiser is asked to determine 'fair market value' for an assignment. According to USPAP, the appraiser should:
Which list gives the sections of the 2024 USPAP Ethics Rule?
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