Appraisal Groups Release Model AMC Legislation and Invite Public Comment
November 2, 2008 08:00 AM
WASHINGTON D.C. (Nov. 2, 2008) – As the number of appraisal management companies (AMCs) continues to grow across the United States, the nation’s largest professional organizations of real estate appraisers are releasing draft model legislation calling for the registration and regulation of AMCs. The model legislation is a joint effort of the Appraisal Institute (AI), the American Society of Appraisers (ASA), the American Society of Farm Managers and Rural Appraisers (ASFMRA), and the National Association of Independent Fee Appraisers (NAIFA). The organizations are inviting comment and discussion from all stakeholders regarding the model and the overall topic of the future regulation of AMCs. A copy of the draft model legislation is available at: www.appraisalinstitute.org/newsadvocacy/downloads/modelprovisionsAMC.pdf.
"The nation’s real estate appraisers are excited to be at the forefront on this very important issue. We look forward to a robust discussion regarding AMC registration and regulation. The model is intended to be a starting point from which the appraisal community, state appraiser boards, and state legislatures can begin to draft their own legislation and regulation," explained Bill Garber, director of government and external relations for the Appraisal Institute.
Garber further explained that the language in the model is intended to give state appraiser boards the statutory authority that they need to develop and implement registration requirements for appraisal management companies operating in their states.
"Today, AMCs are presenting themselves as appraisal service providers to the public, charging consumers appraisal fees on their HUD-1 statements," Garber explained. "Yet these entities are currently outside the bounds of state appraisal regulatory agencies. This model bill is intended to address this glaring loophole."
As currently drafted, the model contains the following provisions:
"The organizations look forward to working with state legislators, state boards and our local chapters as they begin discussions on this extremely important topic in their states," said Garber.
Requires the registration of AMCs operating in the state that order residential appraisals from independent appraisers. Provides exemptions for “in-house” appraisal departments, AMCs that order less than 10 appraisals in a state in a year, and for appraisers that subcontract to other appraisers on an incidental basis;
Prohibits AMCs from being owned by individuals who have had an appraiser license or certification denied, refused, cancelled or revoked;
Requires the identification of a “controlling person” for each AMC;
Requires AMCs to have systems in place to verify that they only utilize licensed or certified appraisers, and that all appraisals are in compliance with USPAP;
Enacts requirements that ensure that appraisers are free from coercion or inappropriate influence from AMCs; and
Provides for the adjudication of disputes between AMCs and independent appraisers.
For more information, or to provide feedback, on the model legislation, please contact Scott DiBiasio, Manager of State & Industry Affairs at (202) 298-5593 or via e-mail email@example.com.
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The Appraisal Institute is a global membership association of professional real estate appraisers, with nearly 24,000 members and 91 chapters throughout the world. Its mission is to advance professionalism and ethics, global standards, methodologies, and practices through the professional development of property economics worldwide. Organized in 1932, the Appraisal Institute advocates equal opportunity and nondiscrimination in the appraisal profession and conducts its activities in accordance with applicable federal, state and local laws. Members of the Appraisal Institute benefit from an array of professional education and advocacy programs, and may hold the prestigious MAI, SRPA and SRA designations. For more information regarding the Appraisal Institute, please visit www.appraisalinstitute.org.