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M A R K E T P U L S E / S T E V E A L B E R T
In an effort to comply with the new rules, appraisers
must find a way to adapt.
CFPB – GREAT FOR
BORROWERS,
PAIN FOR APPRAISERS?
ffective January 18, 2014, the Consumer Financial
Protection Bureau (CFPB) implemented as an
amendment to the Equal Credit Opportunity Act
(ECOA), requiring lenders notify loan applicants
of their right to receive a free copy of the appraisals
developed in connection with their loans. Lenders are
required to provide applicants a copy of each appraisal
and other written valuation promptly upon their
completion, or at least three business days before the
loan closes, whichever is earlier. e borrower is to
receive a copy of the valuations even if the loan does
not close.
Historically, while anyone in possession of an
appraisal could file a complaint against the authoring
appraiser to the respective state licensing board, the
borrower was not automatically provided a copy of
the appraisal. Typically only the appraiser's client and
any other stated intended users of that appraisal report
received a copy of the appraisal. e CFPB rule marks
the first time applicants/borrowers will automatically
be sent a copy of the appraisal. For appraisers, this will
likely result in an increase in complaints regarding their
work product.
is rule is one of many implemented by the CFPB
in an effort to better inform and protect the borrower
during the lending and valuation processes, and it is
likely to produce both benefits to consumers, as well as
possible unintended consequences for appraisers.
