Current through Register Vol. 47, No. 17, September 10, 2024
18.1 An AMC must
have and follow a written policy in place regarding the annual audit of
appraisals completed for Colorado assignments during the previous Reporting
Period. The policy must have an effective date and memorialize the dates any
modifications are made. The policy must outline, at a minimum, the following:
A. Appraisal Selection. The audit sample must
be randomly selected and a USPAP Standard 3 Review must be performed on not
less than two percent (2%) of all appraisal reports performed by appraisers for
the AMC during the previous Reporting Period. A minimum of at least one (1)
USPAP Standard 3 Review must be performed for each appraiser who completed a
Colorado appraisal assignment during that Reporting Period.
B. Risk-Based Reviews. If an AMC maintains a
risk-based review process, the AMC is required to comply with Subsection A. of
this Rule only for those appraisers for whom a USPAP Standard 3 Review was not
performed under the risk-based appraisal review process.
C. Review Criterion. The appraisals must be
evaluated for compliance with state and federal regulations, including the
USPAP.
D. Reviewer Qualifications.
The individual(s) performing the audit of the appraisals must possess a
certified credential in this state or any Jurisdiction and be competent to
appraise residential real estate.
E. Appraisal Deficiencies. The AMC must have
procedures in place to address material deficiencies that affect the value
conclusion or the credibility of the report with the appraiser. Material
violations of the USPAP or the Colorado Real Estate Appraiser Licensing Act
must be reported to the Board.
The Board may evaluate an AMC's compliance with its own audit
policies during an investigation.
18.2 For each Colorado appraisal assignment,
an AMC must maintain the following documents or records in a Safe and Secure
Manner for a period of at least five (5) years, or at least two (2) years after
the final disposition of any judicial proceeding in which a representative of
the AMC provided testimony related to the assignment, whichever period expires
last:
A. Contractual agreements with
clients.
B. Any documents
associated with the engagement of an appraiser used to appraise Colorado real
estate.
C. All correspondence with
a client or an appraiser regarding a specific assignment, including an
accounting of payments received from the client and paid to the
appraiser.
D. Appraisals, appraisal
reviews, appraisal updates, recertifications of value, certificates of
completion, broker price opinions or competitive market analyses, comparable
property checks, rent schedules or income analyses, measurements, building
sketches, and any client approved forms.
E. A list of all licensed or certified
appraisers on the AMC's Panel.
F.
Copies of final appraisal reports reviewed as set forth in Rule 18.1, findings
and any subsequent correspondence with the appraiser, client, or
Board.
G. Copies of all processes
and controls pursuant to section
12-10-614(1)(a)(II),
C.R.S. Records may be maintained in electronic format, but must be produced
upon request by the Board and must be in a format that has the continued
capability to be retrieved and legibly printed. Upon request by the Board,
printed records must be produced.
18.3 For all Colorado appraisal assignments,
an AMC must disclose its Colorado license number in writing in the engagement
letter with an appraiser.
18.4
Pursuant to section
12-10-614(1)(h),
C.R.S., when a bona fide dispute exists regarding the performance or quality of
an appraisal, the AMC must notify the appraiser in writing of the reason for
the dispute, how the dispute may be resolved, and what payment will not be made
for the appraisal until the dispute is resolved. The AMC must notify the
appraiser of the dispute and grounds for nonpayment within sixty (60) days of
completion of the appraisal.
