Would we have to provide a borrower a copy of a subsequent appraisal obtained for internal review purpose (we obtain a new limited appraisal approximately every 2 - 3 years for loans as part of our standard review process)? Would the answer change if the loan was originated PRIOR to 01/2014?

"The new ECOA Valuations Rule amends the appraisal provisions of ECOA’s Regulation B. It updates current ECOA rules to say that you must provide applicants for first-lien loans on a dwelling with copies of appraisals, as well as other written valuations, developed in connection with the application, whether or not the applicants request copies."

My thoughts are, no you would not provide a copy, because the appraisal was not obtained in connection with an application. The loan has already been consummated, so there is no way you can send it "promptly upon completion, but no later than 3 days prior to consummation"

CFPB Equal Credit Opportunity Act (ECOA) Valuations Rule - Small Entity Compliance Guide

I know it says "Small Entity" but this appears to be geared toward organizations (of any size) that originate open-end or closed-end loans secured by first liens on dwellings.

I am interested in others thoughts on this as well.

I would say 'no'. What you do internally post-closing and forward should not apply to this rule.

Thank you both for your replies. That is the direction I was going after reviewing 1002.14 and the Guide, but second guess myself at times.

Would this apply to an abundance of caution collateral?

I see no exceptions for ABC situations.

In the commercial world, for some requests we sometimes order 2 appraisals and reconcile them. In other cases, we 2 appraisals for residential properties over $1MM, but only use the lower value appraisal as the one for underwriting (Retail).

If we have a Commercial loan request with a first lien SFR property as collateral and we order two appraisals and either a) reconcile them or b) use the lower valued one, would we be required to provide a copy of each appraisal to the client even though one of them is strictly part of the internal review process?

Is there a cite in the reg or interpretation that directly addresses this scenario?

I believe you would have to give both. I doubt that specific scenario is addressed, but it says you must give a copy of ALL valuations. In your example, the appraisal(s) is(are) developed in connection with an application so it fits the definition of valuation.

The term "valuation" means any estimate of the value of a dwelling developed in connection with an application for credit.

"A creditor shall provide an applicant a copy of all appraisals and other written valuations developed in connection with an application for credit that is to be secured by a first lien on a dwelling. A creditor shall provide a copy of each such appraisal or other written valuation promptly upon completion, or three business days prior to consummation of the transaction"

I second dblack's appraisal of the situation.

I would be very curious how under the appraisal guidelines you could just pick the lower of the two appraisals. That tells me that the higher one is flawed and unacceptable. How do you keep these appraisers on your approved list??? I think you need to re-think your appraisal policies. You are wasting a lot of time and money.