$400,000 Proposed bank threshold for appraisals to be replaced by evaluations
Below are links to the proposed rule, what others are saying, and where to send your comments on the proposed rule.
OCC Issues Notice of Proposed Rulemaking to Exempt Residential Real Estate Transactions of $400,000 or Less from Appraisal Requirements
Excerpts: Rather than requiring an appraisal, the proposal would require that residential real estate transactions exempted by the threshold obtain an evaluation consistent with safe and sound banking practices.
Read what the OCC says in their announcement – one page www.occ.gov/news-issuances/news-releases/2018/nr-occ-2018-123.html
Comments will be accepted for 60 days from publication in the Federal Register.
Instructions in the full Full 69-page proposed rulemaking. Download the above link and search for comments
The word “evaluation” is included many times in the document. Google evaluation to see what it says.
FDIC, OCC, Fed propose raising appraisal threshold for first time since 1994. Good analysis of how many loans would be affected:
Push to cut back on home appraisals sparks controversy
By Ken Harney, long time nationally syndicated real estate writer who regularly writes about appraisal issues
Excerpt: The Trump administration wants to eliminate professional appraisals on a large number of home-sale transactions – a move that critics say could push the country back toward the see-no-evil days of mortgage lending that preceded the housing crash.
Includes comments from appraisers Ryan Lundquist and Pat Turner plus Appraisal Institute.
Link to Appraisal Institute letter
Get rid of appraisers while nobody’s looking
By Ryan Lundquist
Excerpt: I’m guessing these “evaluators” will be real estate agents who do BPOs, employees at banks and data firms, and probably some appraisers who need the work at $75-$100 a pop.
Read it here, plus the appraiser comments, of course.
– FIRREA increased the deminimus from $200,000 (1989) to $250,000 in 1994, but appraisals were still done. Why? Fannie and Freddie’s investors wanted them. FHA, VA, etc did not adopt the deminimus.
– What is an ‘evaluation’ and who does them? Hopefully, someone will tell me what is an evaluation?