Calif. Business and Professions Code § 11319
Amended by S. B. 70
Effective date: January 1, 2019
Until January 1, 2020, licensed real estate appraisers do not need to comply with provisions of the Uniform Standards of Professional Appraisal Practice (USPAP) preventing individuals other than the client from accessing a restricted appraisal report, as long as the appraiser obtains the client’s consent in advance of the report. To be eligible for this exemption:
- the subject property needs to be unrelated to a federally-related real estate transaction or the purchase or refinance of a one-to-four unit residence;
- the transaction may not involve a mortgage secured by a lien on real estate or a business opportunity;
- the report needs to clearly identify all intended users;
- the report needs to state that opinions and conclusions in the report may require additional information from the appraiser’s workfile to be understood; and
- the report needs to state that assumptions the appraiser has not verified may impact the appraised value of the report’s subject.
Editor’s note — Typically, real estate appraisers do not need to abide by USPAP in non-federally-related transactions — meaning transactions that do not involve mortgages made, guaranteed or insured by federally supervised institutions. However, appraisers licensed by the California Bureau of Real Estate Appraisers are bound by these standards, even in non-federally-related transactions which use restricted appraisal reports. Restricted reports do not contain as much information as standard appraisal reports — including details about the appraiser’s analysis — but are far less costly. The intention of the law is merely to broaden access to this lower-cost option.