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ASA, 5 Other Organizations File Comments Opposing Proposed Residential Appraisal Threshold Increase

Feb 05, 2019

The American Society of Appraisers (ASA), along with 5 additional organizations, filed comments with the Federal Reserve, Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency urging the Agencies to abandon a proposed increase in the residential appraisal threshold from $250,000 to $400,000.

In their comments, the organizations point to several factors that all argue against the increase:

  • The Agencies had recently considered the same increase in the residential threshold, and had decided against an increase “based on considerations of safety and soundness and consumer protection”;
  • In passing the Economic Growth, Regulatory Relief, and Consumer Protection Act, Congress declined to increase the threshold and instead provided discrete regulatory relief in rural areas;
  • That many of the market conditions that existed during previous consideration of a threshold increase had changed in a way that does not support an increase today; and,
  • Increasing the threshold such that over 7 in 10 Americans is denied the benefits of a Title XI appraisal harms consumer protection and safety and soundness.

Robert Morrison, International President for ASA, added: “There is no question that homebuyers and lenders are best protected when they engage the services of a professional appraiser in connection with the single largest purchase most Americans will ever make. This proposal ignores that fact, and the agencies’ own prior conclusions, just to give relief to a handful of lenders who do not value homebuyer or taxpayer protection.”

In addition to the comment letter, ASA is part of a group of 18 appraisal organizations who previously requested that the Agencies hold a public hearing about the proposed increase. To date, the Agencies have not responded definitively to the request, but have spoken with ASA and others via conference call to fully understand the nature of the hearing request.

ASA also participated in a number of meetings with members of the House and Senate regarding the proposed increase, and urged Congress to scrutinize the Agencies’ proposal and the reasons they give in support of going to $400,000.

ASA was joined in the comment letter by the Appraisal Institute, the American Society of Farm Managers and Rural Appraisers, MBREA|The Association for Valuation Professionals, the American Guild of Appraisers, OPEIU, AFL-CIO, and RICS. To read the full text of the comment letter, click here.