How is an evaluation of real property collateral defined under USPAP?

An evaluation of real property collateral is defined as an appraisal under the Uniform Standards of Professional Appraisal Practice (USPAP). An appraisal is a systematic process of determining a property's market value based on thorough analysis and consideration of various factors, such as location, condition, market trends, and comparables.

The appraisal must adhere to specific standards and ethical guidelines set by USPAP, which ensures that the appraisal is credible, consistent, and impartial. This is distinct from other definitions such as market analysis, which typically involves assessing market trends and conditions without necessarily leading to a definitive value conclusion, or a consultation, which may provide general advice without formal valuation. A review, on the other hand, involves examining another appraiser's work for compliance with established standards, rather than creating an original value estimate. Therefore, an evaluation for collateral purposes that meets USPAP standards is classified as an appraisal.