Is a notice of the right to receive an appraisal required if we do not obtain an appraisal for a loan secured by real property? We often utilize county valuation for our second mortgages and thus to save the expense to the borrower we do not order appraisals.

Two points:

One, it is any evaluation that may be prepared to be used, not just an appraisal. So it can be one you outsource, or prepare in house that is used that you must be provide the disclosure and eventual evaluation to the applicant.

Second, if you are using only the county valuation without any additional analysis to either prove the value the county provides, or to determine your own based on that as a starting point, then you are in violation of the existing guidelines.

Additionally, the Reg B provisions are for 1st liens, not subordinate mortgages.

Unless that 'second mortgage' is in the first lien position.

Many institutions segregate their mortgage and consumer second programs, and easily forget to have a control in place to ensure that 'seconds' in a first position are subject to the rule.

Back to your original question:

The notice requirement applies to any application for credit to be secured by a first lien on a dwelling. If, at the time of application, you believe you'll be taking a junior lien, you don't need to provide the notice. But if you discover at a later date prior to closing that you'll be in first position, provide the notice within e business days of learning of the first lien position, and deliver a copy of any valuation developed in connection with the application. See 1002.14(a)(2).

so a second lien would not apply correct?

Correct. The Regulation B appraisal copy provisions in section 1002.14 do not apply when the application is for an extension of credit (or involves credit) secured or to be secured by a junior lien.