Nevada Administrative Code Chapter 645C - Appraisers of Real Estate and Appraisal Management Companies
Nevada Administrative Code Chapter 645C — Appraisers of Real Estate and Appraisal Management Companies
1. Overview
NAC Chapter 645C regulates the licensing, practice, and conduct of real estate appraisers and appraisal management companies (AMCs) operating in Nevada. This chapter implements the state’s compliance with the federal Real Estate Appraisal Reform standards and ensures that appraisers meet competency, ethics, and professional standards to protect consumers and the public interest in real estate transactions.
The Nevada Real Estate Division administers this chapter, exercising oversight and enforcement authority over appraisers and AMCs.
2. Purpose and Scope
To establish minimum qualifications, licensing, and certification requirements for appraisers.
To regulate the operation of appraisal management companies.
To ensure appraisal reports comply with Uniform Standards of Professional Appraisal Practice (USPAP).
To enforce ethical conduct and professional competency.
Applies to all licensed or certified real estate appraisers and AMCs doing business in Nevada.
3. Key Provisions of NAC Chapter 645C
A. Licensing and Certification of Appraisers
Defines requirements for trainee, licensed residential, certified residential, and certified general appraisers.
Requirements include education, experience, examination, and background checks.
Specifies application procedures, fees, and renewal requirements.
Provides for license suspension, revocation, or disciplinary actions.
B. Regulation of Appraisal Management Companies (AMCs)
AMCs must register with the Nevada Real Estate Division.
They are required to maintain certain business standards, including:
Written agreements with appraisers.
Compliance with anti-discrimination laws.
Timely payment to appraisers.
Maintaining records of appraiser assignments and work products.
AMCs must provide transparency in fees and ensure appraiser independence.
C. Appraisal Practice Standards
Appraisers must comply with USPAP standards in preparing appraisal reports.
Requirements include:
Accurate and unbiased appraisals.
Disclosure of any conflicts of interest.
Proper documentation and retention of appraisal work files.
Standards for reporting formats and content are outlined.
D. Continuing Education
Licensed appraisers must complete continuing education credits to maintain licensure.
Education must be approved by the Division and relevant to appraisal practice.
E. Enforcement and Discipline
Grounds for disciplinary action include:
Fraud, misrepresentation, or dishonesty.
Violations of USPAP.
Failure to comply with licensing requirements.
Failure to pay fees or maintain records.
The Division may impose fines, suspend or revoke licenses, and issue cease and desist orders.
4. Relevant Case Law and Legal Principles
Although specific Nevada case law regarding NAC Chapter 645C is limited, several important legal principles and related cases illustrate how courts address disputes and enforcement involving real estate appraisers and appraisal management companies.
Case 1: State Board Disciplinary Actions Upheld
Courts have generally upheld disciplinary actions against appraisers for ethical violations, fraudulent appraisals, or failure to meet USPAP standards.
Regulatory agencies’ determinations are given deference if supported by substantial evidence.
Legal Principle: Appraiser licensing boards have broad authority to enforce ethical and professional standards under their statutory mandates.
Case 2: Appraiser Independence and AMC Liability
Litigation has addressed the duty of appraisal management companies to ensure appraiser independence from undue influence.
Courts have recognized that AMCs may be liable if they compromise appraisal objectivity or engage in improper fee practices.
Legal Principle: AMCs are subject to regulatory scrutiny to protect appraisal integrity in real estate markets.
Case 3: Due Process in License Revocation
Appraisers facing license suspension or revocation are entitled to due process: notice, opportunity to be heard, and appeal.
Courts ensure that administrative actions comply with procedural fairness but defer to agency expertise.
Case 4: Appraiser Liability for Negligence
Appraisers may be held liable in civil court for negligent misrepresentation if their reports are used by third parties and contain errors.
Licensing regulations emphasize the importance of competence and care to minimize such liability.
5. Legal and Regulatory Principles
Professional Competency: Appraisers must meet education and experience thresholds to protect consumers.
Appraiser Independence: Both appraisers and AMCs must avoid conflicts of interest or undue influence.
Consumer Protection: The licensing framework safeguards real estate transactions from faulty valuations.
Agency Authority: The Nevada Real Estate Division exercises broad oversight with disciplinary powers.
Due Process: Licensees are entitled to fair procedures before adverse actions.
6. Summary
NAC Chapter 645C creates a regulatory structure ensuring that real estate appraisers and appraisal management companies in Nevada operate professionally, ethically, and competently. It aligns state requirements with federal mandates like USPAP, requiring:
Licensing and continuing education.
AMC registration and operational standards.
Compliance with appraisal practice standards.
Enforcement mechanisms to discipline misconduct.
Courts support these regulations as necessary to protect market integrity, uphold appraisal independence, and ensure fair real estate valuations.
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