2018 Appraisal FAQ 15 – The work-out plan on a problem loan calls for an institution to receive an assignment of a note secured by a deed on a different property. Is this transaction considered a real-estate-related transaction and is an appraisal r

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Q:  The work-out plan on a problem loan calls for a financial institution to receive an assignment of a note secured by a deed of trust on a different property.  Is this transaction considered a real-estate-related financial transaction and is an appraisal required on the collateral property? 
 
A:   Yes, this transaction is considered a real-estate-related financial transaction.  The agencies’ appraisal regulations require an evaluation in certain loan workout situations.44  In such situations, although only an evaluation would be required, the financial institution could choose to obtain a new appraisal.
 
44 See Valuation Guidelines, Appendix A, exemptions 7 and 8.
 
ADDITIONAL INFORMATION:
This can be found in the 2018 “Frequently Asked Questions on Appraisal Regulations and the Interagency Appraisal and Evaluation Guidelines,” which may be found here:
https://www2.occ.gov/news-issuances/bulletins/2018/bulletin-2018-39a.pdf
 

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