delivery of Validation?

Question:

Let's say on a real estate transaction, we utilize a prior appraisal or internally-prepared evaluation. We then properly "validate" that the relied-upon appraisal/eval is still true and accurate.

How are you handling the requirement to deliver to the borrower a copy of their appraisal/eval, if you are relying on one that was pulled forward from a prior transaction, and then "validated".

Technically, no new appraisal or eval was performed. There wouldn't be a new value that was determined. And the borrower had been previously provided with a copy of the appraisal/eval from their prior transaction. Simply, the value is still "X". The was no change in value.

How are you handling this from a compliance perspective? You'd provide the borrower with the Right to Copy of Appraisal Notice within 3-days of application.... but you would not subsequently provide with a copy of an appraisal or eval, because no new appraisal/eval was performed??

And then just provide documentation in your loan file that a prior valuation was relied upon, and reference that the prior valuation was provided to the borrower on X date from the prior transaction?


Any comments from compliance examiners for this type of situation?


Thanks

Have you looked at the commentary for 1002.14? The validation is an internal document that merely restates the value conclusion from a previously developed valuation. FWIW we don't deliver these to the customer, but we keep them in our loan files. Your validation should reference the pertinent dates connected to the previous appraisal. We also wouldn't deliver the old valuation to the customer as it wasn't developed for that particular transaction and was already given to the customer at one point.

I agree entirely. We haven't been providing that validation either. We have an external auditor very gently suggesting that there is some gray area in that section and perhaps to be on the safe side, we should be provide it. I guess I don't see any of that 'gray' in the commentary.

To piggy back on this - do you charge for the validation of an existing appraisal to see if you can relay on the value?