Mortgages, Refinancing and Home Equity Line of Credit (HELOC)
Sometimes homeowners or buyers will want to have an appraisal on the home they want to refinance, or to buy, to be used for a loan at a federally regulated financial institution. However, a lender or lender's agent is required by Federal Law, Title XI of FIRREA, to directly engage the services of an appraiser in a federally related transaction.
An appraiser's disclosure of this fact allows an appraiser to accept the assignment if the owner or buyer still wish to engage the appraiser. However, be advised that this appraisal report cannot be re-used by the lender for the purpose of securing a mortgage loan. Lenders are required by law to obtain their own appraisal report with themselves named as "Client".
In other words, you end up paying for two appraisal reports because an appraiser cannot legally or simply re-assign that report. A new named client means a change in the scope of work, doing due diligence on their behalf, required re-inspection and the submission of an appraisal report in a format designed specifically for federally regulated financial institutions.
Consult with your lender before engaging the services of an appraiser for a federally related transaction. Most lenders are happy to include a copy of the appraisal report with the loan closing documentation.
David Appraisal Service, Inc. We are Greater Tulsa Real Estate Appraisers