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#1664069 - 02/13/12 03:34 PM Appraiser-Customer choice?
Sci_Comply Offline
100 Club
Sci_Comply
Joined: Sep 2011
Posts: 189
I know that we are required not to "steer" customers into a specific type of loan and that we are required to give them options. Does the same thing apply for appraisals? Do we need to provide the customers with a list of appraisers and let them pick one?

Our mortgage loan processor (who has no customer contact) has always picked the appraiser at random. If we are required to give them this option, do you know which Reg or law states this? I am updating our loan policy and this is one question that I came across. Thanks!

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Lending Compliance
#1664078 - 02/13/12 03:45 PM Re: Appraiser-Customer choice? Sci_Comply
RR Joker Offline
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RR Joker
Joined: Nov 2002
Posts: 20,654
The Swamp
Your customer can have nothing to do with who appraises a property...not at all.
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My opinion only. Not legal advice.

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#1664088 - 02/13/12 04:01 PM Re: Appraiser-Customer choice? Sci_Comply
Sci_Comply Offline
100 Club
Sci_Comply
Joined: Sep 2011
Posts: 189
That's what I thought!! But, my silly loan officer said otherwise. smile

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#1664130 - 02/13/12 04:47 PM Re: Appraiser-Customer choice? Sci_Comply
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 46,958
Bloomington, IN
Show your silly loan officer the following from page 6 of the Interagency Appraisal guidelines.

An institution or its agent must directly select and engage appraisers. The only exception to this requirement is that the Agenciesí appraisal regulations allow an institution to use an appraisal prepared for another financial services institution provided certain conditions are met. An institution or its agents also should directly select and engage persons who perform evaluations. Independence is compromised when a borrower recommends an appraiser or a person to perform an evaluation. Independence is also compromised when loan production staff selects a person to perform an appraisal or evaluation for a specific transaction. For certain transactions, an institution also must comply with the provisions addressing valuation independence in Regulation Z (Truth in Lending).
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The opinions expressed are mine and they are not to be taken as legal advice.

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#1664161 - 02/13/12 05:28 PM Re: Appraiser-Customer choice? Sci_Comply
HRH Okie Banker Offline
Power Poster
Joined: Jan 2003
Posts: 3,070
Oklahoma
Here is the link to the 2010 Guidelines. Keep it handy to show your lenders:

http://www.fdic.gov/news/news/financial/2010/fil10082a.pdf
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