Illinois valuation products explained
Illinois CMA vs. BPO vs. appraisal
The same comparable sale can appear in a broker's pricing analysis and an appraisal. That does not make the products interchangeable. Start with the assignment, the person doing the work and the decision the recipient will make.
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The short answer
An Illinois statutory CMA analyzes pricing, marketing or financial aspects of a real estate interest. A BPO estimates probable selling price. An appraisal develops an opinion of value under the applicable appraisal law and standards. Check the ordinary-course brokerage exclusion before treating pricing advice as a statutory CMA or BPO. Covered broker products must satisfy 10-45, including the written contents and mortgage-origination use limit.
PSI lists CMA/BPO requirements in Illinois II.L and valuation comparisons in National III.A and III.C. The whole Illinois License Act area has 16 of 40 scored state questions; the whole national Valuation area has 8 of 100. Neither figure is a quota for this comparison. Reviewed October 26, 2026. Questions here are original teaching material, not released PSI questions.
Classify the assignment before choosing the report
- Read the requested output. Is the broker analyzing pricing, marketing or financial aspects, estimating probable selling price, or undertaking appraisal practice? A label, comparable sale or interior visit alone does not settle the classification.
- Check the ordinary-course exclusion. Both Illinois broker-product definitions exclude ordinary brokerage activity when no compensation is paid other than compensation based on the sale or rental. That is more specific than saying every free opinion is exempt or every listing-price discussion requires a formal statutory report.
- Match the preparer to lawful authority. Section 10-45 authorizes brokers and managing brokers for its listed users and purposes. A residential leasing agent does not gain that authority merely because the subject is a rental. Appraisal practice has separate licensing requirements and exceptions.
- Identify the actual use. Buyers, sellers, lessors, lessees and specified third-party decisions appear in 10-45(a). Reject the stated primary-market-value use for a financial institution's mortgage origination secured by the subject property. A lender's willingness to accept a disclaimer does not change that use.
- Complete the written broker report. Paper or electronic delivery must include purpose, the real estate interest, methodology, assumptions or limits, existing or contemplated preparer interest, developer name/license number/signature and the substantially prescribed not-an-appraisal statement. Additional appropriate items do not replace these subjects.
- Use the correct credential and support. For a dual broker/appraiser licensee preparing a CMA or BPO, rule 790(a) specifies broker or managing-broker name and number on the initial page, not the appraiser number. Check data, analysis and limitations; a compliant heading cannot rescue fabricated evidence.
| Point | Illinois statutory CMA | Illinois statutory BPO | Appraisal |
|---|---|---|---|
| Core meaning | Pricing, marketing or financial analysis | Probable selling-price estimate or analysis | Development of an opinion of value |
| Ordinary brokerage exclusion | Express definition qualification | The same express qualification | Use the actual appraisal law and its exceptions |
| Authorized broker-product preparer | Broker or managing broker | Broker or managing broker | Applicable appraisal authority |
| State broker-product report rule | 10-45 written contents | 10-45 written contents | Appraisal development and reporting requirements |
| Nature of the conclusion | Supportable analysis for the stated use | Supportable probable selling price | Value opinion for the defined appraisal problem |
| Shared sales data | Possible | Possible | Possible; shared data do not merge the products |
| Interior observation | Does not itself create an appraisal | Does not itself create an appraisal | Inspection scope depends on the assignment |
| Mortgage-origination limit | Apply the specific 10-45 limit | Apply the same limit | Apply the actual law and loan program |
| Correct label | Substantially prescribed not-appraisal statement | Same statement | Do not misrepresent a broker product as appraisal |
The distinctions that matter
| Distinction | How it works | What to notice |
|---|---|---|
| Everyday CMA language and the statutory definition | People often call listing-price comparisons a CMA. The Act expressly excludes the defined ordinary-course activity with no compensation other than sale- or rental-based compensation. Read the facts before applying the statutory report checklist. | The ordinary-course and compensation conditions work together. |
| CMA and BPO | The CMA definition covers pricing, marketing or financial aspects; the BPO definition centers on probable selling price. Both can serve the users permitted by 10-45. A seller does not automatically mean CMA, and a third party does not automatically mean BPO. | Requested analysis matters more than a stereotype about the recipient. |
| Appraisal and appraisal report | The Act defines appraisal as developing an opinion of value or the opinion itself. A report communicates the appraisal or appraisal review to the client on completion. The general Illinois report definition includes written or oral communication; particular assignments can require writing. | Do not confuse the broad report definition with a loan program's required format. |
| Mortgage origination and every lender request | The 10-45 boundary specifies a financial institution, mortgage origination, security in the subject real estate and use as the primary basis to determine market value. Do not replace it with a ban on every lienholder or servicing assignment. | State all the supplied elements before rejecting the use. |
| A report signature and a dual-license initial page | The statute requires the developing broker's or managing broker's name, license number and signature in the report. The initial-page broker-versus-appraiser identity requirement is separately stated for dual licensees in 790(a). | Neither a team label nor a generic company name supplies the developer's required identity. |
| An existing interest and a contemplated interest | The report must disclose either. A present plan to buy the property through an entity is not irrelevant merely because the broker has not submitted an offer. Other transaction or agency disclosures may also apply. | No current ownership does not necessarily mean no report conflict. |
| An inspection limit and permission to be misleading | An exterior-only assignment can have disclosed limits. It does not justify claiming that unseen interiors were inspected or presenting guesses as established condition facts. | Describe what was observed, what was sourced and what was assumed. |
Work through the facts
Ordinary listing advice without a separate fee
In the ordinary course of brokerage, a broker recommends a listing range. No compensation is paid other than compensation based on the eventual sale.
- The question supplies both conditions in the definition's exclusion.
- An everyday use of the word CMA does not override that exclusion.
Answer: This activity is excluded from the statutory CMA definition. That does not erase other brokerage duties or authorize appraisal practice.
A separately paid pricing analysis
An Illinois broker accepts a separate fee from a potential seller to analyze pricing and marketing for a specified property interest. The assignment is not appraisal practice.
- The separate fee defeats the supplied ordinary-course no-other-compensation condition.
- The output fits the statutory pricing and marketing analysis.
Answer: Apply the covered CMA requirements, including a permitted use and the full written report contents.
A financial institution wants an origination shortcut
A financial institution asks a broker for a BPO as the primary basis to determine market value when originating a mortgage secured by the subject home. It accepts a not-appraisal disclaimer.
- The supplied use meets the express prohibited-use elements.
- A disclaimer cannot alter what the institution will use the report for.
Answer: Do not provide the BPO for that stated use. Determine the lawful product required for the loan; do not assume every loan has identical appraisal requirements.
An existing lienholder asks about disposition
A lienholder requests a broker's probable selling-price analysis to evaluate disposition of an existing asset. The facts do not involve mortgage origination.
- An existing lienholder is among the recipients addressed in 10-45(a)(4).
- The origination ban does not by itself reject every such request.
Answer: The assignment can be a permitted BPO if its actual use and all other requirements are satisfied. This is not approval of every servicing, court or lending use.
Two licenses, one brokerage product
A dual-licensed managing broker and appraiser delivers a statutory CMA. Its initial page identifies only the appraiser credential.
- The product is delivered as a CMA.
- Rule 790(a) expressly specifies the brokerage name and credential for this dual-license situation.
Answer: Use the managing-broker name and real estate license number on the initial page and meet the remaining CMA requirements. Do not dress the product as an appraisal.
A plan to acquire the property
A broker prepares a paid BPO for an estate representative while planning to buy the subject through an LLC. No offer has been submitted.
- The preparer has a contemplated interest in the subject.
- The report requirement is not limited to completed ownership.
Answer: Disclose the contemplated interest and produce truthful, adequately supported work. Separately address any other applicable agency or transaction disclosure.
An immaculate report with invented sales
Every report heading and the statutory statement are present, but the broker invents closed sales to reach the desired price.
- Correct contents do not make invented evidence true.
- Rule 790(b) addresses false or misleading statements and inadequate or improper preparation.
Answer: The report is not rescued by its label or disclaimer; discipline can follow.
A data table does not establish product identity
A broker's pricing analysis and an appraiser's assignment both use the same recent sale. Each also adjusts for supported property differences.
- Comparable data and adjustments can appear in different products.
- Authority, assignment, actual use, development and reporting still matter.
Answer: Do not conclude that the broker performed an appraisal merely because the analysis contains an adjusted comparable. Equally, do not use a CMA title to hide actual appraisal practice.
Exterior evidence presented as an interior inspection
A broker has only exterior observations and property records for a paid BPO, but describes the bathrooms as personally inspected.
- An exterior assignment can have honest, disclosed limits.
- The broker cannot convert an unobserved feature into a personal observation through report wording.
Answer: Correct the claim, identify the actual sources and disclose relevant assumptions or limits. A short form or client instruction does not excuse a misleading representation.
Mistakes to avoid
- Every listing discussion is a statutory CMA. Apply both ordinary-course and compensation conditions in the definition.
- Every free price opinion is unregulated. The exclusion is specific; other law and brokerage duties still apply.
- All lender requests are prohibited BPOs. Apply the exact purpose, security and primary-basis limit; other requirements can still restrict the assignment.
- A residential leasing license authorizes a CMA for rent. Section 10-45 names brokers and managing brokers.
- An interior visit turns any report into an appraisal. Inspection scope alone does not determine the legal product.
- The current marketing title of USPAP automatically updates Illinois law. Check the edition incorporated by the adopted Illinois rule.
- A not-appraisal statement excuses a hidden purchase plan or fabricated sales. Required interest disclosure and truthful, adequate preparation still apply.
Check your understanding
These are original teaching questions, not recalled or predicted PSI questions. Answer first, then explain why the other choices fail.
1. A broker gives ordinary-course listing-price advice with no compensation other than sale-based compensation. What does the CMA definition provide?
- The specified activity is excluded from the statutory CMA definition
- It always requires the statutory standalone CMA report
- Only appraisers may give this ordinary brokerage advice
- The exclusion applies to every opinion for which no cash changes hands
Show answer and explanation
Answer: A. The specified activity is excluded from the statutory CMA definition
Both supplied conditions match the statutory exclusion. It is not a blanket no-cash exemption: ordinary-course activity and the actual compensation conditions matter, and other duties remain.
2. A separate fee is paid for a broker's pricing and marketing analysis, otherwise fitting the statutory CMA definition. What is the sound conclusion?
- A signature alone makes the assignment compliant
- Apply the covered CMA requirements
- All fees convert broker work into an appraisal
- The no-other-compensation exclusion necessarily applies
Show answer and explanation
Answer: B. Apply the covered CMA requirements
The supplied separate fee does not fit the ordinary-course no-other-compensation exclusion. Apply purpose, authority and the complete report requirements.
3. Which requested output most directly matches the BPO definition?
- A promise of mortgage approval
- A guarantee of closing price
- An estimate or analysis of probable selling price
- A determination of property boundaries
Show answer and explanation
Answer: C. An estimate or analysis of probable selling price
Probable selling price is the definition's central output. Varying report detail does not make it a guarantee.
4. A financial institution will use a BPO as the primary market-value basis for mortgage origination secured by the subject property. Which answer fits 10-45?
- Permitted if the report is electronic
- Permitted if the institution accepts a disclaimer
- The stated use is excluded
- Permitted if the broker visits the interior
Show answer and explanation
Answer: C. The stated use is excluded
The facts supply the institution, primary market-value basis, mortgage origination and subject-property security elements. A disclaimer does not cure the use.
5. An existing lienholder asks about disposition of an asset, without mortgage origination in the facts. What follows?
- The broker no longer needs report contents
- Every lienholder BPO is automatically approved
- Do not reject every such assignment under the origination limit; assess actual lawful use and requirements
- Every lienholder BPO is prohibited
Show answer and explanation
Answer: C. Do not reject every such assignment under the origination limit; assess actual lawful use and requirements
Section 10-45 lists existing or potential lienholders and other third parties with a qualified use boundary. Absence of origination is not approval under every other law.
6. A covered CMA will be delivered entirely orally. Which requirement is missing?
- Use of exactly three comparable sales
- The required paper or electronic writing
- A guaranteed selling price
- An automatic property inspection
Show answer and explanation
Answer: B. The required paper or electronic writing
Section 10-45(b) requires writing. Do not import the general Illinois appraisal-report definition into the broker-product writing rule.
7. A paid BPO preparer plans to buy the subject through an LLC but has not offered. Which item belongs in the report?
- No interest disclosure until title passes
- Only the LLC's filing fee
- The contemplated interest
- Only completed ownership interests
Show answer and explanation
Answer: C. The contemplated interest
Section 10-45(b)(5) includes contemplated as well as existing interests in the subject real estate.
8. A dual broker/appraiser licensee prepares a BPO. Under 790(a), what belongs on its initial page?
- Only the appraisal credential
- The broker name and real estate license number, not the appraiser number
- Only the team brand
- Only a property address
Show answer and explanation
Answer: B. The broker name and real estate license number, not the appraiser number
The rule states this credential distinction for the dual-license preparer of a CMA or BPO. The remaining statutory contents still apply.
9. A statutory CMA identifies only the brokerage company, omitting the developing broker's name, license number and signature. What is the issue?
- Required developer identity and signature are missing
- The company name always substitutes for the developer
- Only the appraiser number is missing
- A photograph is the sole missing requirement
Show answer and explanation
Answer: A. Required developer identity and signature are missing
Section 10-45(b)(6) requires the name, license number and signature of the broker or managing broker who developed the product.
10. A residential leasing agent wants to independently prepare a statutory CMA because the subject is rental property. What matters?
- The rental subject gives every licensee the same authority
- The disclaimer grants a new license scope
- Section 10-45 names brokers and managing brokers
- Only the fee amount determines authority
Show answer and explanation
Answer: C. Section 10-45 names brokers and managing brokers
The product authority is not supplied merely by a residential leasing license or rental subject. Check the preparer's actual lawful authority.
11. An authorized BPO includes an interior visit. Does that fact alone make it an appraisal?
- Yes, every interior visit is appraisal practice
- Yes, if any comparable sales are used
- No, because no BPO ever has legal requirements
- No; classify the actual assignment, authority, use and work
Show answer and explanation
Answer: D. No; classify the actual assignment, authority, use and work
Inspection detail is one feature of scope, not the sole product definition. A broker-product label also cannot disguise actual appraisal practice.
12. A report includes every heading but invented comparable sales. Which answer is sound?
- False or inadequate work can still lead to discipline
- Client approval makes the sales real
- The correct license number cures the data
- The disclaimer immunizes its analysis
Show answer and explanation
Answer: A. False or inadequate work can still lead to discipline
Rule 790(b) addresses false, untruthful or misleading statements and inadequate or improper preparation. Correct labels are not a safe harbor.
13. Which distinction follows the general Illinois appraisal definitions?
- Every appraisal must estimate only an asking price
- An appraisal develops a value opinion; its report communicates the results, with particular formats governed by applicable requirements
- An appraisal report can never be oral under the general definition
- Only interior observation defines an appraisal
Show answer and explanation
Answer: B. An appraisal develops a value opinion; its report communicates the results, with particular formats governed by applicable requirements
The Act distinguishes appraisal development from report communication. Its general report definition includes oral or written communication, without overriding a particular assignment's writing requirement.
14. Which USPAP edition does the identified current Illinois 1455.240 rule incorporate?
- Every future edition automatically
- No edition because brokers can prepare CMAs
- Only the edition a client prefers
- 2024, with no later amendments or editions incorporated by that wording
Show answer and explanation
Answer: D. 2024, with no later amendments or editions incorporated by that wording
The adopted rule expressly identifies 2024 USPAP. Do not equate publication of a later edition with its automatic adoption in Illinois.
15. A broker and appraiser use the same sale and supported adjustments in separate assignments. What can be concluded from that fact alone?
- The appraiser must have prepared a BPO
- Shared data do not establish identical product identity
- The broker must have performed an appraisal
- Their licenses become interchangeable
Show answer and explanation
Answer: B. Shared data do not establish identical product identity
The full assignment, authority, actual use and work matter. An adjusted comparable is not an exclusive marker of appraisal practice.
16. How does 10-45(b)(8) treat other items the broker considers appropriate?
- They may supplement the specified report contents
- They replace the required signature
- They replace every limiting condition
- They permit any otherwise prohibited use
Show answer and explanation
Answer: A. They may supplement the specified report contents
Additional appropriate material does not replace the required subjects or make an unlawful use lawful.
Common questions
What is the difference between an Illinois CMA and BPO?
A statutory CMA addresses pricing, marketing or financial aspects of an interest in real estate. A BPO estimates or analyzes probable selling price. Both have the ordinary-course compensation exclusion, permitted-use rules and covered written-report requirements. Neither is an appraisal merely because comparable sales are used.
Is ordinary listing-price advice always a statutory CMA?
No. Both broker-product definitions exclude ordinary-course brokerage activity when no compensation is paid other than compensation based on the sale or rental. People may still use CMA informally for a listing comparison. The legal definition and facts control the statutory checklist.
Does every free opinion qualify for that exclusion?
No. Read the ordinary-course condition as well as the compensation condition. Compensation is not limited to cash. A lack of a separate fee is not a universal exemption from brokerage duties, truthful work or appraisal licensing law.
Who can prepare a covered Illinois CMA or BPO?
Section 10-45 names a broker or managing broker for its listed users and purposes. A residential leasing license or unlicensed assistant role does not independently confer that authority. Appraisal practice has separate credential requirements and statutory exceptions.
Can a BPO be used by a financial institution?
Read the actual intended use. Section 10-45 excludes primary market-value reliance for mortgage origination by a financial institution secured by the subject real estate. It does not say every existing lienholder or servicing request is prohibited, and it does not approve every other use.
Can a disclaimer make the prohibited mortgage use acceptable?
No. A statement identifying a BPO or CMA as not an appraisal does not change the financial institution's intended use or override other applicable appraisal requirements.
Must a covered CMA or BPO be in writing?
Yes, on paper or electronically. The statutory contents still apply to a short electronic form. Do not substitute a wholly oral discussion when the facts establish a covered statutory product.
What information must the written broker report contain?
Identify intended purpose; briefly describe the real estate interest and methodology; disclose assumptions or limiting conditions and any existing or contemplated preparer interest; include developer name, license number and signature; and use the substantially prescribed not-appraisal statement. Other appropriate items can supplement those subjects.
Does every broker have the same initial-page rule as a dual licensee?
The statute requires the developing broker or managing broker's name, license number and signature in the report. Rule 790(a) separately specifies initial-page brokerage identity, rather than appraiser identity, for a person who holds both credentials. Keep those two provisions distinct.
Does an interior BPO become an appraisal?
No, an interior visit alone does not decide product identity. Report the actual scope and limits honestly. A BPO title also cannot convert actual unauthorized appraisal practice into permitted brokerage work.
Must a planned purchase interest be disclosed before an offer?
The report must disclose an existing or contemplated interest in the subject. A present acquisition plan through an LLC can be relevant before an offer. Other agency and transaction disclosures remain separate questions.
Is an appraisal always the same as market value?
No. Appraisal is development of an opinion of value; the assignment must identify the relevant value problem. An asking, offered or closing price is not automatically a market-value conclusion. Apply the actual appraisal definition, authority and standards.
Can an Illinois appraisal report be oral?
The general statutory report definition includes written or oral communication of an appraisal or appraisal review transmitted to the client on completion. A particular law, loan program, engagement or reporting requirement may require writing. That general definition does not waive 10-45's written broker-report requirement.
Which appraisal standards rule should I read?
Use current 68 Ill. Adm. Code 1455.240. It incorporates 2024 USPAP with no later amendments or editions. Its jurisdictional exception is limited to the portion precluded by applicable law or regulation for the particular assignment, not a client's preference to ignore standards.
Does a perfect report checklist prevent discipline?
No. Rule 790(b) addresses false, untruthful or misleading statements and inadequate or improper preparation. Invented sales, concealed conflicts or misrepresented observations are not cured by the right heading or disclaimer.
Are these official exam questions or a readiness score?
No. These are original explanations and practice questions. Use a missed answer to locate a definition, use restriction or report requirement you need to understand. No score on this short set establishes that you will pass the exam.
What is the statutory not-an-appraisal statement?
Section 10-45(b)(7) calls for a statement in substantially this form: "This is a broker price opinion/comparative market analysis, not an appraisal of the market value of the real estate, and was prepared by a licensed real estate broker or managing broker who was not acting as a State certified real estate appraiser." The statement is one required part of the covered report, not an exception to the use limit.
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Official sources and scope
Use the actual definition and intended use before applying the report checklist. Illinois rule 1455.240 incorporates the 2024 USPAP edition with no later amendments or editions; a future edition is not automatically adopted. This comparison does not reproduce USPAP, determine a live appraisal exemption or approve a loan valuation.
- PSI June 24, 2026: national valuation and Illinois CMA/BPO requirements
- 225 ILCS 454/1-10: CMA, BPO and ordinary-course compensation exclusion
- 225 ILCS 454/10-45: permitted uses and complete written-report contents
- 68 Ill. Adm. Code 1450.790: dual-license identity and deficient reports
- 225 ILCS 458/1-10: appraisal, reports and AVM definitions
- 225 ILCS 458/5-5: appraisal licensing and selected exceptions
- 68 Ill. Adm. Code 1455.240: incorporated USPAP edition and qualified exception
This is exam preparation, not advice for a specific transaction. State law and the applicable facts control. Our editorial and corrections process explains how to report an issue.