Which section of Title XI specifically addresses the establishment of minimum standards for performing federally related real estate appraisals?
Correct Answer
C) Section 1113
Section 1113 of Title XI specifically addresses the establishment of minimum standards for performing federally related real estate appraisals. This section provides the foundation for professional appraisal standards and practices.
Why This Is the Correct Answer
Section 1113 of Title XI is specifically titled 'Minimum Standards' and directly addresses the establishment of minimum standards for performing federally related real estate appraisals. This section mandates that appraisals must be performed in accordance with generally accepted appraisal standards as evidenced by the Uniform Standards of Professional Appraisal Practice (USPAP). It also requires that appraisals be conducted by state-licensed or certified appraisers, establishing the fundamental quality control mechanisms for federally related transactions. Section 1113 serves as the cornerstone for professional appraisal standards in federal oversight.
Why the Other Options Are Wrong
Option A: Section 1110
Section 1110 deals with the definitions and general provisions of Title XI, not the establishment of minimum standards for appraisals.
Option B: Section 1112
Section 1112 addresses the functions of federal financial institutions regulatory agencies and their role in appraisal oversight, not the minimum standards themselves.
Option D: Section 1116
Section 1116 covers enforcement provisions and penalties for violations, not the establishment of minimum appraisal standards.
Lucky 13 Standards
Remember '1113' as 'Eleven-Thirteen = Lucky 13 Standards' - Section 1113 is your 'lucky' section that contains all the minimum STANDARDS you need to follow as an appraiser.
How to use: When you see questions about minimum standards or USPAP requirements in Title XI, immediately think 'Lucky 13 Standards' and recall that Section 1113 is the standards section.
Exam Tip
Focus on the key word 'standards' in the question - whenever you see questions about minimum standards, professional standards, or USPAP requirements under Title XI, Section 1113 is likely the answer.
Common Mistakes to Avoid
- -Confusing Section 1112 (regulatory agency functions) with 1113 (standards)
- -Thinking Section 1110 covers standards when it only covers definitions
- -Assuming Section 1116 covers standards when it actually covers enforcement
Concept Deep Dive
Analysis
This question tests knowledge of the specific sections within Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) of 1989. Title XI was enacted to establish federal oversight of real estate appraisals used in federally related transactions, creating a framework for appraiser licensing and certification. Each section of Title XI addresses different aspects of appraisal regulation, from definitions to enforcement mechanisms. Understanding the specific section numbers and their purposes is crucial for appraisers as it demonstrates knowledge of the foundational legal framework governing their profession.
Background Knowledge
Title XI of FIRREA was enacted in 1989 following the savings and loan crisis to ensure the quality and reliability of real estate appraisals used in federally related transactions. The law established a comprehensive framework requiring state licensing and certification of appraisers and mandating adherence to uniform professional standards.
Real-World Application
Every time an appraiser performs a federally related appraisal (such as for a bank loan), they must comply with Section 1113 requirements, including following USPAP standards, being properly licensed/certified, and meeting all minimum performance standards established by this section.
More Report Writing Questions
Under FIRREA, which federal agency has the authority to set minimum standards for real estate appraisals in federally related transactions?
What is the minimum transaction threshold for requiring a state licensed or certified appraiser under Title XI for most federally related transactions?
The Dodd-Frank Act established which requirement specifically related to appraisal independence?
Which of the following is NOT a responsibility of the Appraisal Subcommittee (ASC)?
State appraiser regulatory agencies are primarily responsible for which of the following functions?
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