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#1702822 - 05/24/12 01:38 PM appraisals for secondary market loans
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for loans being sold on the secondary market, we don't allow the LO to request the appraisals. This is done through another person at coorporate. This sounds odd to me and am currently checking on the reasons behind it. Does anyone know of any requirements from HUD or specific regs?
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#1702830 - 05/24/12 01:46 PM Re: appraisals for secondary market loans DoS
Dan Persfull Offline
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Under the Interagency Appraisal Guidelines the LO should not be ordering an appraisal or an evaluation for any credit they are involved in. If they are then you are in violation of the independence requirements and are subjecting your FI to sanctions and penalties.
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#1702842 - 05/24/12 02:01 PM Re: appraisals for secondary market loans DoS
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alright ... there you go. Thanks
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#1703199 - 05/24/12 08:55 PM Re: appraisals for secondary market loans DoS
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new question on the same subject. 12 CFM 34, it does not state anything about who can and cannot request the appraisals. So, which takes precedence, the OCC reg or the evaluation guidelines? (yes we are OCC regulated)
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#1703227 - 05/24/12 10:28 PM Re: appraisals for secondary market loans DoS
Truffle Royale Offline

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ah, the INTERagency guidelines apply across all regulators.
LOs should never be ordering appraisals or evaluations for ANY credit they're involved in.

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#1703297 - 05/25/12 01:32 PM Re: appraisals for secondary market loans DoS
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thanks
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#1704685 - 05/30/12 07:18 PM Re: appraisals for secondary market loans Truffle Royale
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Has there been any updates regarding rural communities where branch offices have limited personnel to make independent appraisals and/or evaluations?

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#1704714 - 05/30/12 07:33 PM Re: appraisals for secondary market loans DoS
Dan Persfull Offline
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A limited exception has always been present.

For a small or rural institution or branch, it may not always be possible or practical to separate the collateral valuation program from the loan production process. If absolute lines of independence cannot be achieved, an institution should be able to demonstrate clearly that it has prudent safeguards to isolate its collateral valuation program from influence or interference from the loan production process. In such cases, another loan officer, other officer, or director of the institution may be the only person qualified to analyze the real estate collateral. To ensure their independence, such lending officials, officers, or directors must abstain from any vote or approval involving loans on which they ordered, performed, or reviewed the appraisal or evaluation.
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#1704909 - 05/30/12 09:59 PM Re: appraisals for secondary market loans DoS
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as an update, we are a small and rural institution. We have loan processors not associated with the particular loan requesting appraisals. The issue I originally asked about was due to the loan purchaser wanting a little more independence in the process. Until I found that particular document, I was confused. Thanks.
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