RISMEDIA, April 30, 2009-The Appraisal Institute, one of the nation’s largest organizations of professional real estate appraisers, is urging Congressional representatives to pass H.R. 1728, the Mortgage Reform and Anti-Predatory Lending Act of 2009, a bill that would eliminate a number of regulatory loopholes in the mortgage lending system and strengthen the appraisal regulatory structure. Currently, the bill is being considered by the House Financial Services Committee.
“Our organization supports the Mortgage Reform Act not only because it returns to the fundamentals of mortgage lending and protects the independence of the appraiser from undue third-party pressure, but also because it ultimately seeks to safeguard the best interests of consumers,” said Jim Amorin, MAI, SRA, president of the Appraisal Institute. “The American public needs and deserves a healthy mortgage lending system.”
In testimony last week before the House Financial Services Committee, Amorin presented lawmakers with a short list of reforms the Appraisal Institute believes are needed to protect the safety and soundness of mortgage finance system transactions. The Committee unanimously approved an amendment sponsored by Rep. Paul Kanjorski (D-PA) that is consistent with many reforms recommended by the Appraisal Institute:
-Requirements for complete interior inspection appraisal requirements for all subprime loans.
-Establishment of a federal appraisal independence standard with up to $20,000, per day, in civil penalties for violations.
-Modernizing provisions of Title XI of FIRREA to provide additional resources for state enforcement and greater accountability of federal and state appraisal regulators.
-Validation for consideration of professional appraisal designations in appraiser hiring decisions.
-Required separation and clear disclosure of fees paid to appraisers and fees paid for appraisal administration (fees paid to appraisal management companies).
-Limitations on the use of broker price opinions in mortgage origination.
-Registration requirements and a regulatory regime for Appraisal Management Companies, with mechanisms to prohibit infiltration by appraisers sanctioned by state regulatory agencies.
“We are pleased to see Congress moving swiftly and in the right direction to curb abusive lending practices,” noted Amorin. “Our organization urges all appraisers and members of the public to contact their Representatives in support of H.R. 1728 and to encourage them to become a co-sponsor of the bill.”
For more information, visit www.appraisalinstitute.org.