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http://www.federalreserve.gov/newsevents/press/bcreg/20101018a.htm

Press Release

Release Date: October 18, 2010
For immediate release
The Federal Reserve Board on Monday announced an interim final rule to ensure that real estate
appraisers are free to use their independent professional judgment in assigning home values without
influence or pressure from those with interests in the transactions. The rule also seeks to ensure that
appraisers receive customary and reasonable payments for their services.
The interim final rule includes several provisions that protect the integrity of the appraisal process
when a consumer's home is securing the loan. The interim final rule:
Prohibits coercion and other similar actions designed to cause appraisers to base the appraised
value of properties on factors other than their independent judgment;
Prohibits appraisers and appraisal management companies hired by lenders from having
financial or other interests in the properties or the credit transactions;
Prohibits creditors from extending credit based on appraisals if they know beforehand of
violations involving appraiser coercion or conflicts of interest, unless the creditors determine
that the values of the properties are not materially misstated;
Requires that creditors or settlement service providers that have information about appraiser
misconduct file reports with the appropriate state licensing authorities; and
Requires the payment of reasonable and customary compensation to appraisers who are not
employees of the creditors or of the appraisal management companies hired by the creditors.
The interim final rule is required by the Dodd-Frank Wall Street Reform and Consumer Protection
Act. Compliance will be mandatory on April 1, 2011. Public comments are due 60 days after the
interim final rule is published in the Federal Register, which is expected soon.
Attachment (470 KB PDF)

11/1/2010 4:49 PM