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#2233268 - 03/18/20 08:59 PM ECOA Appraisal rule for Debt Modification
Likes to Comply Offline
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Joined: Nov 2008
Posts: 1,049
In the mountains
A commercial dwelling secured loan changing the rate and extending out the maturity via a debt modification. The appraisal obtained three years ago at the origination of the loan was re-validated by our on staff appraiser. Must a copy of the re-validation be given three days in advance of consummation of the debt modification?
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Lending Compliance
#2233281 - 03/19/20 11:47 AM Re: ECOA Appraisal rule for Debt Modification Likes to Comply
Adam Witmer Offline
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Joined: Sep 2010
Posts: 2,612
Great question as this can be quite confusing. In short, the answer is yes. The re-validation is new and the customer has not yet received a copy, so they should be provided with one. The preamble to the final rule talks about this in a round about way, but here is what the commentary says:

2. Renewals. Section 1002.14(a)(1) applies when an applicant requests the renewal of an existing extension of credit and the creditor develops a new appraisal or other written valuation. Section 1002.14(a)(1) does not apply to the extent a creditor uses the appraisals and other written valuations that were previously developed in connection with the prior extension of credit to evaluate the renewal request.
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Adam Witmer, CRCM

All statements are my opinion, not those of my employer, and should not be taken as legal advice.
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