Existing Appraisal to New Borrower

Posted By: bgehres

Existing Appraisal to New Borrower - 09/14/18 05:27 PM

We have a loan where the borrower died, the person inheriting the property wants to refinance the loan to pay off the existing debt. Can we use the original appraisal since this new request is to a different borrower?
Posted By: Darth HMDA, CRCM, CAMS

Re: Existing Appraisal to New Borrower - 09/14/18 05:44 PM

What was the time period between initial loan and now

what does your credit policy state

what does your investor require
Posted By: bgehres

Re: Existing Appraisal to New Borrower - 09/14/18 05:49 PM

The initial loan was less than a year ago. We would use this appraisal on a new loan to the same borrower. No policy issues and no investor involved.
Posted By: Know Nothing

Re: Existing Appraisal to New Borrower - 10/17/18 06:57 PM

Another thing to consider would be the HPML rule if this rule applies. If it does and exemptions do not apply then I don't think you have a choice but to have a new outside appraisal.
Posted By: bgehres

Re: Existing Appraisal to New Borrower - 10/18/18 01:08 PM

It's a farm and not subject to Reg Z so no HPML issues.
Posted By: Richard Insley

Re: Existing Appraisal to New Borrower - 10/18/18 03:28 PM

Originally Posted By bgehres
It's a farm
That's fine, but is the purpose of the new credit for:

"planting, propagating, nurturing, harvesting, catching, storing, exhibiting, marketing, transporting, processing, or manufacturing of food, beverages (including alcoholic beverages), flowers, trees, livestock, poultry, bees, wildlife, fish, or shellfish by a natural person engaged in farming, fishing, or growing crops, flowers, trees, livestock, poultry, bees, or wildlife"?
Posted By: bgehres

Re: Existing Appraisal to New Borrower - 10/19/18 08:32 PM

Both the original and new loans are without a doubt farm purpose and not subject to Reg Z or consumer purpose.