The Federal Reserve System, through its Consumer Compliance Outlook platform, recently hosted its annual Fair Lending Interagency Webinar. During the session, a variety of fair lending topics were discussed, including redlining, appraisal bias, and Special Purpose Credit Programs (SPCPs), as well as supervision and enforcement-related updates. Presenters included representatives from the following federal agencies: Consumer Financial Protection Bureau (CFPB), Department of Housing and Urban Development (HUD); Department of Justice (DOJ); Federal Deposit Insurance Corporation (FDIC); Federal Housing Finance Agency (FHFA); Federal Reserve Board (FRB); National Credit Union Administration (NCUA); and Office of the Comptroller of the Currency (OCC).… Continue Reading
CFPB and other federal agencies address appraisal discrimination
The CFPB’s Fair Lending Director, together with senior officials from other federal agencies, have sent a letter to The Appraisal Foundation (TAF) commenting on proposed changes to the Uniform Standards of Professional Appraisal Practice (USPAP). (TAF is a private, non-governmental organization that sets professional standards for appraisers.) The other agencies joining in the letter are the Federal Reserve Board, Office of the Comptroller of the Currency, Federal Deposit Insurance Corporation, National Credit Union Administration, Department of Housing and Urban Development, Federal Housing Finance Agency, and Department of Justice.… Continue Reading
Senate Banking Committee schedules Dec. 5 markup of regulatory reform bill
Last week, members of the Senate Banking Committee announced that they had reached bipartisan agreement on “legislative proposals to improve our nation’s financial regulatory framework and promote economic growth.” Following the announcement, Committee members released a draft of a bill (S. 2155), the “Economic Growth, Regulatory Relief, and Consumer Protection Act.” … Continue Reading
CFPB/Fed/OCC increase exemption thresholds for appraisal requirement, Regs Z and M
The CFPB, Fed, and OCC have published notices in the Federal Register announcing that they are increasing three exemption thresholds that are subject to annual inflation adjustments. Effective January 1, 2018 through December 31, 2018, these exemption thresholds are increased as follows:
- Smaller loans exempt from the appraisal requirement for “higher priced mortgage loans,” increased from $25,500 to $26,000
- Consumer credit transactions exempt from Truth in Lending Act/Regulation Z, increased from $54,600 to $55,800 (but loans secured by real property or personal property used or expected to be used as a consumer’s principal dwelling and private education loans are covered regardless of amount)
- Consumer leases exempt from Consumer Leasing Act/Regulation M, increased from $54,600 to $55,800.
Financial institution agencies provide guidance to help alleviate appraiser shortage
The federal banking agencies together with the National Credit Union Administration (the “Agencies”) issued an Interagency Advisory on the Availability of Appraisers that is intended to help address the real estate appraiser shortages being experienced by lending institutions.
Pursuant to the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA), the Agencies require the institutions they regulate to obtain a real estate appraisal from a state licensed or certified appraiser in any federally related transaction, unless an exemption applies. … Continue Reading
Federal agencies issue final rule on standards for appraisal management companies
The CFPB along with five other federal agencies have issued a final rule that establishes minimum state registration and substantive requirements for appraisal management companies (AMCs), as required by Section 1473 of the Dodd-Frank Act. AMCs that are a subsidiary of an insured depository institution and are federally regulated (federally regulated AMCs) are subject to the substantive requirements of the rule, but are not subject to state registration or supervision requirements. … Continue Reading
CFPB increases appraisal requirement exemption threshold
The CFPB, Fed, and OCC have adjusted the threshold for smaller loans that are exempt from the appraisal requirement for “higher priced mortgage loans.” The appraisal requirement became effective January 18, 2014, and the exemption, which is subject to annual adjustment for inflation, currently applies to credit extensions of $25,000 or less.… Continue Reading
Federal financial regulatory agencies finalize appraisal requirement exemptions
The CFPB, Fed, FDIC, FHFA, NCUA, and OCC have finalized a supplemental rule creating several exemptions to the appraisal requirements for higher-priced mortgage loans (HPML). Those requirements are contained in the final rule adopted jointly by the agencies in January 2013 to implement Dodd-Frank provisions mandating appraisals for HPMLs.
The final rule creates the following two exemptions that take effect on January 18, 2014 (which is the same date that the rule adopted in January 2013 becomes effective):
- An exemption for certain refinances with characteristics common to “streamlined” refinances.
ABA and MBA ask CFPB to reconsider coverage of business credit in ECOA appraisal rule
The American Bankers Association and the Mortgage Bankers Association have sent a letter to the CFPB asking it to reconsider the applicability of the final Equal Credit Opportunity Act (ECOA) appraisal rule to business credit. The rule applies to loan applications received on or after January 18, 2014. It implements a Dodd-Frank amendment to the ECOA that requires creditors to provide to an applicant for a loan secured by a first lien on a residential structure containing one to four units a copy of all written appraisals and valuations developed in connection with the application. … Continue Reading
CFPB final ECOA appraisal rule issued
Among the flurry of mortgage-related final rules issued by the CFPB this month was a final rule to implement a Dodd-Frank amendment to the Equal Credit Opportunity Act that requires creditors to provide to a first lien mortgage applicant a copy of all written appraisals and valuations developed in connection with the application.… Continue Reading