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Statement 5: Temporary Practice [Published at 62 F.R. 19755 (April 23, 1997)]

Title XI requires a State agency to recognize on a temporary basis the certification or license of an appraiser from another State provided: (1) the property to be appraised is part of a federally related trans­action; (2) the appraiser’s business is of a temporary nature; and (3) the appraiser registers with the State appraiser regulatory agency in the State of temporary practice. Thus, a certified or licensed appraiser from State A, who has an assignment concerning a federally related transaction in State B, has a statutory right to enter State B, register with the State agency in State B and perform the assignment. Title XI does not require State B to offer temporary practice to persons who are not certified or licensed appraisers, includ­ing appraiser assistants not under the direct supervision of an appraiser certified or licensed in State A. An out-of-State certified or licensed appraiser should register for temporary practice before beginning to perform an appraisal assignment in connection with a federally related transaction.

The ASC believes that “temporary” is best measured by one or more specific appraisal assignments. For temporary practice purposes, the ASC regards the term “assignment” as meaning one or more real estate appraisals and written appraisal reports which are covered by a contract to provide an appraisal.

Title XI also states that a State appraiser certifying or licensing agency shall not impose excessive fees or burdensome requirements, as determined by the ASC, for temporary practice. The ASC considers the following fees, acts and practices of the State of temporary practice to be “excessive fees” or “burdensome requirements”:

 

  • Prohibiting temporary practice;
  • Requiring temporary practitioners to obtain a permanent certification or license in the State of tem­porary practice;
  • Taking more than five business days (after receipt of a complete temporary practice registration request) to issue a temporary practice permit (if issuance is required under State law) or to provide effective notice to the out-of-State appraiser regarding the status of his or her temporary practice request;
  • Requiring out-of-State appraisers requesting temporary practice to satisfy the host State’s appraiser qualification requirements for certification which exceed the minimum required criteria for certifica­tion adopted by the Appraiser Qualifications Board (AQB);
  • Limiting the valid time period of a temporary practice permit to less than six months after its issuance date or not providing a temporary practitioner with an effortless method of obtaining an extension of the time period;
  • Limiting out-of-State certified appraisers to a single temporary practice permit per calendar year;
  • Requiring temporary practitioners to affiliate with an in-State certified or licensed appraiser;
  • Failing to take regulatory responsibility for a visiting appraiser’s unethical, incompetent or fraudulent practices performed while within the State;
  •  After taking disciplinary action against a visiting appraiser, failing to forward copies of available evi­dence and final disciplinary orders promptly to the appraiser’s home State agency; and
  • Charging a temporary practice fee exceeding $150.

In addition, the ASC will consider the following fees, acts and practices of the certified or licensed appraiser’s home State to be excessive or burdensome:

  • Delaying the issuance of a written “letter of good standing” or similar document for more than five business days after the home State agency’s receipt of the related request; and
  • Failing to take appropriate disciplinary action when one of its certified or licensed appraisers is
           disciplined by another State agency for unethical, incompetent or fraudulent practices under a                      temporary practice permit.

This listing is not exclusive. The ASC may find other excessive fees or burdensome practices while performing its State agency monitoring functions.

An out-of-State certified or licensed appraiser must comply with the host State’s real estate appraisal statutes and regulations. Each appraiser who receives temporary practice registration is subject to the State’s full regulatory jurisdiction and is governed by the State’s statutes and regulations respecting appraiser certification or licensing. However, the out-of-State appraiser should be treated like any other appraiser within the State who wishes to perform an appraisal in a federally related transaction.

A State agency may establish by statute or regulation a policy that places reasonable limits on the number of times an out-of-State certified or licensed appraiser may exercise his or her temporary practice rights in a given year. If such an overall policy is not established, a State agency may choose not to honor an out-of-State certified or licensed appraiser’s temporary practice rights if it has made a determination that the appraiser is abusing his or her temporary practice rights and is regularly engaging in real estate appraisal within the State.

Finally, some State agencies have sought to require that an appraiser register for temporary practice if the appraiser is certified or licensed in another State, performs a technical review of an appraisal in that other State and changes, or is authorized to change, a value in the appraisal. The ASC, however, has concluded that for federally related transactions the review appraiser need not register for temporary practice or otherwise be subjected to the regulatory jurisdiction of the State agency in which the appraisal was performed, so long as the review appraiser does not perform the technical review in the State within which the property is located.