Disparate Treatment and Impact in USPAP

Disparate Treatment and Impact in USPAP. USPAP has introduced the terms DISPARATE TREATMENT AND IMPACT in its 5th exposure draft.

Disparate treatment and impact are bad for appraisers because they can damage the reputation of the profession, lead to legal and regulatory action, and negatively impact the success and viability of individual appraisers and their businesses.

Disparate treatment occurs when an appraiser treats individuals or groups differently based on their race, ethnicity, gender, religion, or other protected characteristics. This type of discrimination is illegal and can result in legal and regulatory action, as well as damage to the appraiser’s reputation and business.

Disparate impact occurs when a policy or practice has a disproportionate effect on individuals or groups based on their protected characteristics, even if there is no intention to discriminate. This type of discrimination is also illegal and can result in legal and regulatory action, as well as damage to the appraiser’s reputation and business.

In addition to the legal and reputational risks, discriminatory practices can also harm the appraiser’s business by reducing their client base, limiting their ability to work with certain lenders or clients, and decreasing their credibility and trustworthiness in the industry. It can also lead to a lack of diversity and inclusion in the profession, which can limit opportunities for growth and innovation.

In short, it is important for appraisers to be aware of and avoid disparate treatment and impact in their work.

Unfortunately, racism and bias can exist in any profession, just as they can exist in any aspect of society. I’m not sure why every appraiser has a bullseye on them now.

By Pro Appraiser, Certified Real Estate Appraiser

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10 Responses

  1. Avatar Bill Johnson says:

    This is something to keep an eye on. On a side note, in other appraisal news, check out the following form the appraiser coach.


    In the above post, the following was stated.

    “This girl runs comps, and in my office our goal is to have each comp take about one minute. When we timed her, she averaged at about one or one and a half minutes per comp. We talked about it and now she’s working to hit one minute per comp. I guarantee that she’ll be consistently reaching her goal here soon.”

    Seek the truth people.

    • Baggins Baggins says:

      I tried to comment there, my post like never appeared. We’ll see if they allow it through or not. Picking comps in a minute flat, straight incompetence. The first thing which came to mind when I read the term ‘disparate impact’, was how damaging the appraisal management industry has been to the appraisers in the appraisal industry.

      The advisory board may want to dip back in for a 6th, 7th, and 8th uspap rewrite. Some people just don’t understand how to provide a finished product and leave it alone. The level of nihilism required to continue to believe in the fictitious racist appraisers line alongside progressive ideas sounds utterly exhausting.

      Pepsi challenge; count of the totality of every single uspap draft exposure, and provide me a ratio for how many updated final versions there has been, comparative to drafts, and print them all out on paper for a visual reference. Don’t let these people anywhere near encyclopedias or dictionaries, they could panic and hurt themselves or someone else.

      Have you ever met someone whom tried and failed so many times, yet insisted on trying the same method again and again only to certainly fail again, and said to yourself; Now that’s someone I can personally trust to get the job done correctly the first time. The uspap revisionists need to get back in there, keep grinding, and eventually an appraisal miracle could happen and they’ll get it right. What do you call it, when literally everyone except you is a ‘protected class’? Who’s bright idea was it to hire DEI consultants as literary revisionists? May want to reconsider that one.

  2. Avatar Eric Kretz says:


    – The appraiser didn’t consider sales from another neighborhood (superior) and their actions were race-based and led to a lower value conclusion.

    – The appraiser said my home wasn’t HUD/FHA compliant because of my defective trim paint. He must think I’m poor and can’t afford to maintain my home, and that is ‘Disparate Treatment’.

    -We didn’t like his value, so lets go through that appraisal and see if there are any racial commentary to fine/sue him.

    Just more bullets in the proverbial USPAP gun for State licensing boards, lawyers, and angry realtors and homeowners to prosecute and fine appraisers.

    • Baggins Baggins says:

      Interesting, Eric, interesting. Well, if we’re going to incorporate these terms into the ethics book, it’s best to know the full details. DOJ on disparate impact.

      And we’re back to the ‘nature of harm’ consideration. Where if appraisers over valued peoples houses for unrealistic numbers they could not actually sell for in the free market, that may be actually passing the three judicial consideration tests of intentional disparate treatment and subsequent disparate harm. Do you think the geniuses rewriting the ethics draft for the fifth time bothered to read these details? It is not necessary to add watered down language to an ethic book, when the terms described are clearly established law which applies universally to everyone in the first place. However we can accept these terms, as now there is official language in the ethic book which can be argued to highlight the disparate treatment and disparate impact the amc industry has imposed upon all licensed appraisers, which has led to the inability to hire and take on new people, increase diversity of the ranks, has limited the opportunity of appraisers, imposed a restraint of trade system as well as a pay to play system upon all of us. The imposition of remote inspection services is also apparently another example of current real world disparate treatment and disparate impact upon appraisers which further contributes to lack of resources, and therefore lack of diversity and new opportunity.

      There is no one-size-fits-all measure for disparity. Investigating agencies must tailor their methodology to the circumstances in each case in order to ensure an accurate measurement. For example, under the Fair Housing Act, HUD noted that deciding whether “a particular practice results in a discriminatory effect is a fact–specific inquiry” and that because there are “numerous and varied practices and wide variety of private and governmental entities covered by the Act, it would be impossible to specify in the rule the showing that would be required to demonstrate a discriminatory effect in each of these contexts.” Implementation of the Fair Housing Act’s Disparate Impact Standard, 78 Fed. Reg. 11,460, 11,468, (Feb. 15, 2013). Where recurring case types have sufficient commonalities, however, agencies can consider crafting guidelines for measuring and defining adverse disparate impact in their recipients’ programs. Where such guidelines apply, the investigating agency should, of course, use the methodologies developed for specific matters. ‘

      Did that just take us full circle back to how the credit programs instituted by lenders are to blame more than the reading of current market values by appraisers? Here is another one; The disparate impact of the fictitious Brookings study on racist appraisers. 1. Intention. 2. Clearly caused harm. 3. Proven inadequate and/or faulty methods by the AEI report. 4. Causation is proved by the special benefits Brookings seeks to receive, and hand out, by their act of intentional harm and slander upon the appraisal community, use of improper influence upon TAF. Hell, this could even apply to the amc’s whom sat on the PAVE task force. Dave Bunton, the chief disparate impact champion. Intention. Harm. Inadequate qualifications coupled with inept leadership. Receiving of special benefits. Another four tests passing grade. Winning! (That is a long MF read, I made it through about half and bookmarked for later, suggest you save also.) This will give me a lot of interesting things to drone on about and inject with unnecessary questions in the next live ethics class, lol. Good luck to anyone trying to teach appraisers about this subject matter, after one would have already read the DOJ advisement and example positions from the Title VI legal manual, section VII. And that’s how it’s done, easy. It’s incorporated into the uspap book and therefore, expertise and mastery of this topic matter is now an additional licensing requirement for appraisers. No problem, give me another. PAREA graduates don’t stand a chance.

    • Exactly my thought on the comps. Our “practice” is to select comps in same or comparable neighborhoods so if that means these areas selling lower than in other areas we are applying a disparate PRACTICE. This is going to be a field day for lawsuits. Can’t wait to see how much our E & O insurance premiums rise. Kind of like malpractice insurance Doctors pay, but they are paid WELL more than we will ever be to afford this type of insurance.

  3. Avatar Will says:

    The Appraisal Industry is being led by incompetent regulators who focus on silly issues.

  4. Avatar Johnny Q says:

    More redundancy and gobbledygook for USPAP. The comps/market and analysis speaks for itself. Is the analysis sound, are the comps conditionally and locationally adequate and relevant to the subject. End of story. Who’s concerned about ethnicity or race and how can one appraise a property on that basis? It’s not the appraisers who request that photos of people, ethnic art, etc. be blocked or cropped from photos. What’s next, requiring appraisers to state that 74 genders were not a factor in arriving at an opinion of value?

  5. The ASC and FHFA are meeting Friday May 19, 2023 to discuss bias and solutions. AARO is going to be represented by MY states BREA (not a good thing)



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Disparate Treatment and Impact in USPAP

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