Selection From Appraiser List
Question: My impression of an approved appraiser list has never been that the lenders must select appraisers by rotating through the approved appraiser list. Although I do see the importance of independence of the appraiser from the loan, is it really necessary to formally rotate through the list?
Answer: Selecting the appraiser by rotating through the approved appraiser list is a best practice, but it is not mandatory. The important thing is that the selection be independent. To that end, rotating through the list is one way of demonstrating independence. Allowing lenders to freely select appraisers places more responsibility on the reviewer of the appraisal to be sure that it is fair, accurate, and not influenced by the loan officer.
Copyright © 2005 Compliance Action. Originally appeared in Compliance Action, Vol. 10, No. 11, 10/05
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