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#1986915 - 01/07/15 04:52 PM Construction/Perm and Right to Receive Appraisal
Julie Price Offline
New Poster
Joined: Nov 2014
Posts: 19
Topeka, KS
End loan was applied for in February - disclosure was provided within 3 days. Construction loan was applied for in June. Should another disclosure have been provided to customer for the construction loan since the construction and end loans are separate? Also, since the appraisal for the end loan is typically a "re-certification" of the value, would that re-cert need to be delivered to the customer at least 3 days before the end loan closes?

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Interagency (Reg Z) and CFPB Reg B Appraisal Rules
#1989877 - 01/21/15 01:36 AM Re: Construction/Perm and Right to Receive Appraisal Julie Price
Jack Holzknecht Offline

Gold Star
Joined: Aug 2001
Posts: 330
Louisville, KY
The construction phase of a construction/permanent loan is exempt from the HPML appraisal disclosure requirement in 1026.35(c)(5)(i); however the appraisal disclosure required by 1002.14(a)(2) of Regulation B does apply to initial construction if secured by a dwelling. Since the construction and permanent loans are separate transactions, an appraisal disclosure is required for each. Since the "recert" is an estimate of the value of a dwelling developed in connection with the loan, a copy should be provided to the consumer.

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