Federal regulators of the nation’s financial institutions have come up with a short-term solution to the shortage of real estate appraisers.
An
interagency advisory on the availability of appraisers was issued in response to concerns over the limited availability of state-certified and -licensed appraisers — especially in rural areas.
Jointly issuing the advisory
Wednesday were the Federal Reserve Board, Federal Deposit Insurance Corp., National Credit Union Administration, and Comptroller of the Currency.
The regulators said representatives from the financial industry have raised concerns about appraisal timeliness tied to the shortage.
According to the notice, banks and credit unions can use out-of-state appraisers who obtain temporary practice permits in their state.
“Subject to limitations in states’ laws, temporary practice permits could allow state certified or licensed appraisers to provide their services in states where they are not certified or licensed, including those experiencing a shortage of appraisers,” the advisory states.
The other option is a temporary waiver, which is authorized through
Section 1119 of Title XI. The Appraisal Subcommittee, with the approval of the Federal Financial Institutions Examination Council, can grant temporary waivers of any requirement relating to certification or licensing of individuals to perform appraisals under Title XI.
The waivers would be in states or geographic political subdivisions where there is an appraiser shortage that leads to significant delays in obtaining appraisals in connection with federally related transactions.
Waivers can be submitted by a
state appraiser certifying or licensing agency, a federal bank regulatory agency or a regulated financial institution or credit union. In addition, other persons or institutions with a demonstrable interest in appraiser regulation can submit waivers.
The waivers require evidence of an appraiser shortage in the geographic and must demonstrate appraiser scarcity led to appraisal delays.
If a waiver is approved for a regulated institution, it only applies to the affected geographic area. In addition, the waiver affects all regulated institutions in that area even if they didn’t request a waiver.
“These temporary waivers may provide regulated institutions lending in affected areas with access to more individuals eligible to complete the appraisals required under Title XI, which may help alleviate some of the
cost and burden associated with having a shortage of state certified or licensed appraisers in affected areas,” the regulators said.
Waiver requests will be published in the Federal Register.
