A property appraisal includes comparable sales that are all located more than 5 miles away from the subject property, despite several recent sales within 1 mile. The appraiser notes 'no suitable comparables in immediate area.' This suggests:
Correct Answer
C) Potential cherry-picking of comparables to support a predetermined value
When an appraiser bypasses closer, recent sales without adequate justification, it may indicate manipulation to support a predetermined value. USPAP requires appraisers to use the most comparable and proximate sales available, and this pattern suggests potential appraisal fraud.
Why This Is the Correct Answer
When an appraiser bypasses closer, recent sales without adequate justification, it may indicate manipulation to support a predetermined value. USPAP requires appraisers to use the most comparable and proximate sales available, and this pattern suggests potential appraisal fraud.
More Ethics & Fraud Questions
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A mortgage company advertises 'Guaranteed approval for all credit types!' but internally has minimum credit score requirements of 580. This advertisement is problematic because it:
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An MLO presents a loan estimate showing a base loan amount of $180,000, but the final loan documents show $195,000 with the difference attributed to 'closing cost financing' that includes $8,000 in credit insurance products the borrower doesn't recall discussing. The borrower signed the initial application but not specific product authorizations. This scenario primarily involves: