Can the regulated institution accept an appraisal prepared by an appraiser who is engaged by a financial services institution with whom the appraiser has an affiliated business relationship?
The business relationship between the financial services institution and the appraiser may not necessarily violate the independence requirement of the agencies’ appraisal regulations. However, the agencies’ appraisal regulations do not permit a regulated institution to accept an appraisal in which the appraiser has a direct or indirect interest, financial or otherwise, in the property or the transaction. The regulated institution should evaluate the financial services institution’s controls to ensure independence and that there is appropriate separation of responsibilities and reporting lines between the appraiser and the financial services institution’s lending function.
Related Questions
- Can the regulated institution accept an appraisal prepared by an appraiser who is engaged by a financial services institution with whom the appraiser has an affiliated business relationship?
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