Property Valuation
Under the Uniform Standards of Professional Appraisal Practice (USPAP), an appraiser who knowingly provides a false appraisal has committed:
ANegligent misrepresentation
BAppraisal fraud✓ Correct
CA harmless error
DPuffery
Explanation
Appraisal fraud involves intentionally providing a false or misleading appraisal. This violates USPAP, federal law (including the Financial Institutions Reform, Recovery, and Enforcement Act), and Alaska real estate and criminal law.
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Key Terms to Know
Appraisal
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
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