Appearing at a Jan. 24 Appraisal Subcommittee hearing on appraisal bias, Appraisal Institute President Craig Steinley, MAI, SRA, AI-GRS, AI-RRS, testified
that “As the agencies continue development of guidelines and regulations that touch on appraisal topics, we offer the resources of AI, including our Designated Members, to assist with understanding of appraisal standards, appraisal methodology and appraisal practice.”
Steinley emphasized the importance of a strong consumer appeals processes, encouraging all member agencies of the ASC to support protocols like the Department of Veterans Affairs’ Tidewater Initiative
, which is used in VA transactions when the appraised value of a home falls below its contract purchase price.
The Appraisal Institute along with ASA, ASFRMA and MBREA submitted on Feb. 2 a comment letter
to the Federal Housing Administration in response to a draft Mortgagee Letter
from the Department of Housing and Urban Development that establishes a process for underwriters when a borrower requests a review of an appraisal associated with an FHA-insured mortgage application.
The organizations noted in the letter that a well-developed Reconsideration of Value process “can be beneficial to borrowers, underwriters and appraisers in ensuring fair and accurate appraisals in connection with FHA-guaranteed loans.” It was recommended that HUD consider the Department of Veterans Affairs’ Tidewater Initiative as both a template for new policy and as a means for aligning the agencies as closely as possible so participating mortgage lenders have generally consistent protocols and procedures.
The organizations also emphasized that clear guidance must be given to underwriters regarding the circumstances under which a ROV request should be forwarded to an appraiser. They stated, “Absent meaningful guidance, it is our concern that underwriters will err on the side of always forwarding reconsideration requests to the appraiser, as it will be the easiest, and less risky, option to shift borrower complaint risk to the appraiser.”
The Appraisal Institute noted in both a comment to the IRS
and in testimony before the agency that it supports the IRS’s proposed rule
to curb syndicated conservation easement transactions. However, because the IRS lumped appraisals in with other promotional or sales activity that is more applicable to non-appraisers, AI reminded the agency that “appraisers do not provide ‘advice’ as independent third parties when producing an appraisal. It is simply a value opinion.”
Additionally, AI asked that any final rule “provide(s) sufficient guidance to appraisers on the application of any material advisor requirements,” specifically stating that appraisers must identify the client and any intended users of the appraisal, which would help align the parlance of IRS rules with appraisal standards and regulation.
The General Services Administration on March 7 issued a final rule that amends the Federal Management Regulation, Real Estate Acquisition
, by clarifying policies regarding lease agreements for high-security space in accordance with the Secure Federal Leases from Espionage And Suspicious Entanglements Act, also referred to as the Secure Federal Leases Act.
The final rule takes effect April 6 and will require the identification of all beneficial owners, meaning “any person that, through a contract, arrangement, understanding, relationship, or otherwise, exercises control over the covered entity or has a substantial interest in or receives substantial economic benefits from the assets of the covered entity, with some exceptions.”
The amended policy is a response to recently heightened national security concerns about foreign ownership and control, and congressional action in the realm of government contracting.