Newly Introduced Legislation Strengthens Appraisal Independence and Penalizes Improper Appraisal Pressure

Representatives Paul Kanjorski (D-PA) -- Chairman of the House Financial Services Committee on Capital Markets, Barney Frank (D-MA), Chairman of the House Financial Services Committee, Paul Hodes (D-NH), and Charlie Wilson (D-OH) introduced the H.R. 3837 the Escrow, Appraisal and Mortgage Services Improvement Act (EAMSIA). EAMSIA accomplishes the following NAR policy goals:

1. Requires that an appraisal be made available to the consumer prior to closing, Mandates a property visit for mortgages covered by the Homeowners Equity Protection Act (HOEPA),

2. Requires the appraisal subcommittee to hold open meetings and publish detailed reports,

3. Amends the Truth in Lending Act to prohibit mortgage originators from improperly influencing the appraisal process -- which is defined as collusion, intimidation, coercion, bribery etc.

4. Amends FIRREA to prohibit those with an interest in the real estate transaction from improperly influencing the appraisal process, with the following exceptions: a) to correct errors, b) to request the appraiser consider additional information, and c) to provide substantiation.

EAMSIA also sets Appraisal Qualification Board guidelines as the minimum criteria for state licensing, increases regulatory authority of the Appraisal Subcommittee in sanctioning, reciprocity, and information sharing. According to an October research survey, over 90% of appraisers have felt undo pressure to meet a targeted price, and over 70% feared harm to their business if they failed to do so. This bill is meant to strengthen the appraisal process. There is a small likelihood that this bill may be considered by the full Financial Services Committee as part of a larger mortgage fraud bill in the near future.

Source: NAR

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Brochure Educates Public on Appraisal Fraud

Recognizing the importance of educating Michigan’s homebuyers on appraisal fraud, the Michigan Council of Real Estate Appraisers (MiCREA) has created a brochure, available in print and online formats, to serve as a resource for both consumers and REALTORS®.

Appraisal/mortgage fraud is a growing problem in Michigan. The brochure can be downloaded online on the MiCREA Web site. The brochure can also be ordered by calling MAR 800.454.7842.

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Appraisal Designation Programs

November is national designation month. NAR awards two designations for appraisers - RAA - Residential Accredited Appraiser & GAA - General Accredited Appraiser.

CRITERIA for the designations are:

1. REALTOR® or Institute Affiliate membership in the NATIONAL ASSOCIATION OF REALTORS® . An Institute Affiliate member must be a designee of one of the following 5 NAR affiliates: IREM, CCIM Institute, RLI, CRE or SIOR.

2. State Certified Residential or General Appraiser for RAA designation and a State General Appraiser for the GAA designation. (In those few states where the Certified Residential classification is unavailable, the requirement is state Licensed for the RAA designation.)

3. A minimum of 1,000 hours experience in addition to the experience required to obtain state certification.

4. Tested education: (45 hours for the RAA) or (60 hours for the GAA) of tested course work in addition to the Appraiser Qualification Board's education requirement at the time of certification.

5. A one time application fee of $100.00 per designation (which includes a non-refundable processing fee of $25.00), PLUS the quarterly prorated amount of the $100 annual maintenance fee for each designation, as listed below:

• First Quarter (January - March): $100
• Second Quarter (April - June): $75
• Third Quarter (July -September): $50
• Fourth Quarter (October - December): $25

For ensuing years, the fee is $100 annually for designation maintenance.

Appraisers may obtain both designations. The program was approved by NAR's Board of Directors at the 1993 Annual Convention. The first designations were awarded at the 1994 Midyear Meeting with approximately 1,100 members maintaining one or both designations.

Learn More.

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MiCREA Members Appointed to NAR Committee

John Collison and Dave Maturen, members of the MiCREA board of directors, have been appointed to the 2008 NAR Appraisal committee. Congratulations John and Dave!

MiCREA Monthly
November 2007

• Legislation Update

• Appraisal Fraud Brochure Available

• Appraisal Designation Programs

• MiCREA Members Appointed to NAR Committee