Uniform Standards of Professional Appraisal Practice (USPAP) Practice Exam

When must an appraiser inform a borrower about the engagement terms?

1. Before the appraisal starts.

2. After the appraisal is completed.

3. Only if requested by the borrower.

4. At the time of payment for services.

The correct answer is: Before the appraisal starts.

An appraiser must inform a borrower about the engagement terms before the appraisal starts. This requirement is rooted in the principle of transparency and ethical practice outlined in the Uniform Standards of Professional Appraisal Practice (USPAP). By providing engagement terms upfront, the appraiser ensures that the borrower has a clear understanding of the scope of work, the fees involved, and any potential conflicts of interest. This proactive communication helps the borrower make informed decisions and establishes trust between the appraiser and the borrower, which is essential for maintaining professional integrity in the appraisal process. Engaging in this practice also aligns with regulatory guidelines that ensure consumers are aware of the services they are receiving and any associated costs before the appraisal begins, thereby protecting their interests throughout the process.