Appraisal Institute Calls for Modernization of Appraisal Regulatory Structure
August 19, 2008 08:00 AM
WASHINGTON D.C. (Aug. 19, 2008) – Yesterday, the nation’s largest professional organization of real estate appraisers, the Appraisal Institute, submitted a joint industry letter to the Senate Banking Committee advocating revisions to deficiencies in the appraisal regulatory structure. Specifically, the Appraisal Institute urged the Senate to adopt Title VII of House Resolution 3915 (H.R. 3915), the Mortgage Reform and Anti-Predatory Lending Act, which would allot greater resources to state appraisal boards for enforcement activities while increasing the effective oversight authority of the Appraisal Subcommittee.
The letter, cosigned by the American Society of Appraisers, American Society of Farm Managers and Rural Appraisers and the National Association of Independent Fee Appraisers, came in response to a recent Associated Press expose highlighting the shortcomings of Title XI of the Financial Institutions, Reform, Recovery and Enforcement Act of 1989. Title XI is the legislation that contains the provisions that govern the appraisal regulatory structure.
"We have been deeply troubled by the lack of responsiveness by some federal and state appraiser regulators in carrying out Title XI responsibilities," said Bill Garber, director of government and external relations for the Appraisal Institute. “We hope the recent attention to weaknesses in the appraisal regulatory structure proves to be a catalyst for the passage of H.R. 3915 and the subsequent modernization of Title XI.”
The Appraisal Institute expressed its concern over the following areas of Title XI, which the organization has stated are in need of revision:
"The appraisal profession is ever-changing and dynamic," explained Garber. “As such, legislation governing the profession needs to adapt to the times in order to ensure the best interests of the public are protected. We believe that Title VII of H.R. 3915 protects those interests and urge the Senate to pass this bill.”
The Appraisal Subcommittee’s lack of enforcement authority over state appraisal boards.
The Appraisal Subcommittee’s lack of resources for conducting investigations and enforcing rules.
The lack of penalties for parties who attempt to coerce appraisers to meet a predetermined opinion of value, thus jeopardizing the integrity of the real estate transaction.
The current appraisal "de minimis," whereby transactions below $250,000 are exempted from Title XI’s appraisal requirements, which according to the Appraisal Institute, “exposes consumers to unregulated valuation products."
H.R. 3915 was voted through the House with strong bipartisan support. Currently the bill is pending in the Senate Banking Committee. For more information on the comment letter sent to the Senate Banking Committee, visit the News and Advocacy section of the Appraisal Institute’s Web site at: www.appraisalinstitute.org/newsadvocacy/actions.aspx.
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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.