PERSONAL PROPERTY APPRAISER MINIMUM QUALIFICATIONS CRITERIA

Dear Member,

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There are some important changes coming to the personal property appraisal industry that you should know. The most important ones are concerned with the new minimum qualification criteria for appraising personal property that were adopted by the Appraisal Qualifications Board (AQB) on July 30, 1998.

The new minimum criteria will be reviewed at the end of this letter. For now, I would like to explain who the AQB is, what they do, and how their work affects us as personal property appraisers.

In the early 1980's the crisis in the savings and loan industry called attention to the need for competent appraisers, particularly in the real estate industry. Many houses were over-valued for the purpose of making home loans. When the economy faltered and unemployment rose, numerous homeowners who could not afford their house payment put their homes on the market. A significant number of homeowners defaulted on their loans. These and other factors had the affect of driving housing prices down. Since the home loans were based on what now became inflated values, the loaning institutions were unable to recover enough money to pay back their investors. The result was the savings and loan crisis that required a sizeable government bailout in order to save the savings and loan industry, and the national economy, from a major disaster.

People in the appraisal industry took note of some of the causes of this monumental problem. In 1986, nine professional appraisal organizations from the United States and Canada came together to establish the Uniform Standards for Professional Appraisal Practice (USPAP). The intent of USPAP was to insure that appraisals are based on established, industry recognized, standards free from outside pressures. In 1987 the Appraisal Foundation was established. The Appraisal Foundation is a not-for-profit organization established by the appraisal profession in the United States to implement the Uniform Standards of Professional Appraisal Practice and foster professionalism in the appraisal industry. Shortly after being established the Appraisal Foundation's Board of Trustees established two additional independent boards: the Appraiser Qualifications Board (AQB) and the Appraisal Standards Board (ASB). The ASB and AQB are authorized to do their work by the United States Congress under Title VI of the Financial Institution Reform, Recovery and Enforcement Act (FIRREA) of 1989.

The function of the AQB is to establish the minimum education, experience, and examination requirements needed for state licensing, certification and re-certification of appraisers. The AQB has, until recently, been primarily concerned with establishing minimum qualification criteria for real estate appraisers who must be licensed by the state in which they will work. FIRREA mandates that all state certified (real estate) appraisers must meet the minimum education, experience and examination requirements established by the AQB. In 1996 the AQB began work on the new Personal Property Appraiser Minimum Qualifications Criteria. These voluntary criteria establish education, experience and examination minimum standards for personal property appraisers. The new Criteria were adopted by the AQB on July 30, 1998. There are no state licensure or certification requirements for personal property appraisers. Personal property appraisal associations, like the American Society of Agricultural Appraisers, have the authority to provide education, testing and certification programs needed to meet these new requirements. Meeting the AQB's new Personal Property Appraiser Qualification Criteria will enable you to do more sophisticated, higher level appraised work...which is what client's in the future will require of appraisers.
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