Much Rejoicing as Financial Reform Bill Passes

The Dodd-Frank Wall Street Reform and Consumer Protection Act, a sweeping financial regulatory reform bill that includes the first modernization of real estate appraisal regulations in more than 20 years, has passed through the Senate, and now awaits President Obama’s signature to become law.

“This bill will mean good news for consumers because they should see more reliable home appraisals,” said president of the Appraisal Institute Leslie Sellers. “It will encourage the use of highly trained and competent real estate appraisers, and will provide much-needed resources for oversight and enforcement.”

The Dodd-Frank Act is the first overhaul of appraisal regulations since the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) of 1989. The House passed the bill on June 30, 2010, and President Obama is expected to sign it into law shortly.

The Dodd-Frank Act will require that “reasonable and customary” fees be paid to real estate appraisers. Appraisers have complained that with the growth of appraisal management companies (AMCs) since the passing of the Home Valuation Code of Conduct (HVCC) in May 2009, they have experienced sharply reduced fees from these appraisal management companies. “Reasonable and customary” fees will reflect what the appraiser would typically be paid for the assignment without an AMC. Under the new act, violations of this policy will result in severe penalties.

By: Present Value

Additional reading:

The Dodd-Frank Wall Street Reform and Consumer Protection Act
Mortgage Players Look to Soften Bill

Tags: AMC, Appraisal Institute, Dodd-Frank Wall Street Reform, FIRREA, HVCC

This entry was posted on Thursday, July 22nd, 2010 at 12:16 pm and is filed under Real Estate Appraisal. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.