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Month: February, 2020

BOD Meeting Minutes 2/12/2020

Friday, February 14, 2020
    

North Dakota Appraisers Association

 Board of Directors Meeting

Conference Call

Wednesday, February 12, 2020

Meeting was called to order by President Bill Gion at 3:00 pm, CST

Present: President: Bill Gion, Secretary/Treasurer: Rhonda Knudson, Past President, Joe Ibach.  Board Members: Patricia Hodenfield,  Wade Becker, Nick Duchscher, Membership Chairman, Dean Rylander,  Executive Secretary: Debbie Ellerton, Advisor, Craig Steinley.  Not present: Board Members, Kathy Berry & Ross Berg, President-Elect, Joe Sumers

The agenda was presented for the meeting. The agenda was approved as presented.

OLD BUSINESS

Strategic Plan Meeting in Medora, August 13 & 14th.  This was reviewed and comments were solicited from the Events committee members and an agenda is forthcoming. 

Wade Becker gave a report on the Tribal appraisal contact that was made.  There has been no response to date.

STANDING COMMITTEE REPORTS

Government Relations: Joe Ibach, Chair

Presentation of Committee Purpose & Goal Statement.

Discussion of the Temporary Waiver Request, Legislative Agenda, Evaluations, Hybrid/Bifurcated Appraisals, and Diminimus Increase.  A motion was made at the November 20, 2019 meeting to contribute $2500 to the Diminimus Increase legal effort, but this did not come to fruition, so that money will not be used to fund that effort. 

Bylaws and Policy Committee: Rhonda Knudson, Chair

Presentation of Committee Purpose & Goal Statement

There was a report and update on the work on the proposed changes to the Bylaws for 2020. 

Finance Committee: Joe Sumers, Chair

Presentation of Committee Purpose & Goal Statement

Debbie Ellerton gave the financial report in the Chairman’s absence.  Motion (Patty Hodenfield) to approve the current financial report.  Nick Duchscher seconded.  Motion carried.

Motion (Joe Ibach) to make a policy change for the Executive Secretary and the Secretary/Treasurer to be the only signatories on the checking account.  Wade Becker seconded.  Motion carried.

Marketing and Public Relations: Wade Becker, Chair

Presentation of Committee Purpose & Goal Statement

Corporate Memberships are being established and will be added to the membership opportunities. 

Website Committee: Ross Berg, Chair

Presentation of Committee Purpose & Goal Statement

Debbie Ellerton, in the absence of the Chairman, gave an update on the website updates and any troubleshooting that has come up with membership renewals.

Education Committee: Kathy Berry, Chair

No report – there was some discussion on Upcoming Spring Class Offering.

Membership Committee: Dean Rylander, Chair

Presentation of Committee Purpose & Goal Statement

Report and updates on Membership & recruiting, Election update, & Associate Membership. 

Motion (Rhonda Knudson) that Membership dues are due by December 31st of each calendar year and if not paid by March 31st of the following year, that member’s profile will be removed from the website.  Motion was seconded by Nick Duchscher.  Motion carried.

Events Committee: Patty Hodenfield, Chair

Presentation of Committee Purpose & Goal Statement

Update on the upcoming November 2020 Annual Conference at the Ramkota in Bismarck on November 18th thru 20th. 

Update on the November 17-19, 2021 Annual Conference at the Doubletree in West Fargo.

Motion (Joe Ibach) to accept all of the Committee Reports.  Patty Hodenfield seconded.  Motion carried.

NEW BUSINESS

 

Next Meeting: TBD

Motion (Patty Hodenfield) to adjourn the meeting.  Nick Duchscher seconded.  Motion carried.  Meeting was adjourned.

Respectfully submitted,

Rhonda Knudson Secretary/Treasurer, NDAA


CategoriesHot Topics

Waters & Clay Request GAO Study to Protect Homeowners from Appraisal Loopholes

Thursday, February 13, 2020

For Immediate Release
February 11, 2020

Waters and Clay Request GAO Study to Protect Homeowners from Appraisal Loopholes

WASHINGTON, D.C. -Congresswoman Maxine Waters (D-CA), Chairwoman of the House Financial Services Committee, andCongressman Wm. Lacy Clay (D-MO), Chairman of the Subcommittee on Housing, Community Development and Insurance, sent aletterto the Comptroller General of the U.S. Government Accountability Office (GAO), requesting a comprehensive study on the implementation of Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA) by the relevant federal agencies.

In the letter, Chairwoman Waters and Subcommittee Chairman Lacy Clay highlighted the law’s importance in ensuring the safety and soundness of our financial system and that homeowners are protected from mortgages with inaccurate valuations.

“Title XI was enacted by Congress in response to the numerous valuation related issues that came to light as a result of investigations and hearings into the causes of the savings and loan crisis of the mid-1980s,” the lawmakers wrote. “These appraisal regulatory provisions were enacted to help ensure the future stability of the deposit insurance fund. While Congress envisioned that most real estate related transactions would be covered by Title XI, that is no longer the case.”

The lawmakers also expressed concerns about the dilution of the original Congressional intent of Title XI through various exemptions from the requirement to obtain an appraisal.

“The Appraisal Subcommittee (ASC), the entity created and charged under Title XI to monitor the appraisal related actions of the Federal financial institutions regulatory agencies (Agencies), estimated in its 2018 report to Congress that ‘at least 90 percent of residential mortgage loan originations are not subject to the Title XI appraisal regulations,’”the lawmakers wrote. “Over the past few decades, however, the federal agencies charged with implementing Title XI of FIRREA have taken steps to limit the number of transactions for which an appraisal is required….We request that you conduct a review of the impact of these changes, including the potential risks that they pose to homeowners and the safety and soundness of our financial system.”

In September 2019, Chairwoman Waters and Senator Sherrod Brown (D-OH), Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee, sent aletterto the Appraisal Subcommittee (ASC) Chairman Arthur Lindo requesting answers about ASC’s decision to grant a waiver of appraiser certification and licensing to the state of North Dakota.

In June 2019, the Subcommittee on Housing, Community Development and Insurance convened a hearing entitled, “What’s Your Home Worth? A Review of the Appraisal Industry” to hear from industry experts and examine legislation that addresses longstanding issues in the appraisal industry.

See full text of theletterbelow.

Gene L. Dodaro
Comptroller General
Government Accountability Office
441 G St., NW
Washington, DC 20548

Dear Comptroller General Dodaro:

We write to request that you undertake a comprehensive study of the implementation of Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA) by the relevant federal agencies. We are concerned about dilution of the original Congressional intent of Title XI of FIRREA through various exemptions from the requirement to obtain an appraisal. We are also concerned that the current rules implementing the appraisal requirement may be insufficient to protect homeowners from the risks associated with an inaccurate home valuation. We respectfully request a Government Accountability Office (GAO) study regarding these issues, including recommendations for how to ensure that the safety and soundness of our financial system is preserved and that homeowners are protected from mortgages with inaccurate valuations.

Title XI was enacted by Congress in response to the numerous valuation related issues that came to light as a result of investigations and hearings into the causes of the savings and loan crisis of the mid-1980s. These appraisal regulatory provisions were enacted to help ensure the future stability of the deposit insurance fund. While Congress envisioned that most real estate related transactions would be covered by Title XI, that is no longer the case. The Appraisal Subcommittee (ASC), the entity created and charged under Title XI to monitor the appraisal related actions of the Federal financial institutions regulatory agencies (Agencies), estimated in its 2018 report to Congress that“at least 90 percent of residential mortgage loan originations are not subject to the Title XI appraisal regulations.”

Over the past few decades, however, the federal agencies charged with implementing Title XI of FIRREA have taken steps to limit the number of transactions for which an appraisal is required.

Threshold Increases:The de minimis threshold, the amount of the transaction below which an appraisal is not required, has been increased numerous times. The agencies quickly raised the amount from $50,000 to $100,000 and then again to $250,000. Earlier this year the Federal Deposit Insurance Corporation (FDIC), the Office of the Comptroller of the Currency (OCC) and the Board of Governors of the Federal Reserve System (FRB) all increased the threshold to $400,000. The National Credit Union Administration (NCUA) has also recently proposed the same increase. According to the National Association of Realtors (NAR) the average sales price of an existing home in October of this year was $270,900.

Regulatory Exemptions:The Federal financial regulatory agencies have adopted thirteen regulatory “carve-outs” to reduce the number of transactions that are classified as federally regulated transactions and thereby covered by the provisions of Title XI. One major exemption is

a residential real estate transaction in which the appraisal conforms to the Federal National Mortgage Association or Federal Home Loan Mortgage Corporation appraisal standards applicable to that category of real estate.

Even though such transactions remain in the lending institution’s portfolio and are covered by the deposit insurance fund, under this exemption they are not considered federally related transactions subject to the protections of Title XI.

Appraisal Waivers:Title XI contains a provision for the ASC to grant temporary waivers if it is determined that there is a scarcity of appraisers. That waiver language was intended for initial transition purposes only, not for use thirty years after the implementation. Additionally, the waiver for the state of North Dakota granted this year by the ASC, the majority of its members appointed by the Agencies, was approved despite the absence of data indicating that a scarcity of appraisers existed.

Evaluations as a substitute for appraisals:The current regulations allow the use of “evaluations” instead of appraisals for transactions below a specified threshold.[1]The agencies’ guidance for conducting evaluations contains no requirements and no standardized methodology; and there is no education requirement for the person conducting the evaluation. Because the agencies’ provisions for evaluations have been issued as guidance, it is not even clear to what extent they are mandatory. It is likely that evaluations will rely heavily on automated valuation models (AVMs). But the agencies have not yet promulgated regulations mandated by the Dodd-Frank Act to implement quality control standards for AVMs.

We request that you conduct a review of the impact of these changes, including the potential risks that they pose to homeowners and the safety and soundness of our financial system. If you have any questions about this letter, please contact Darrell “Rico” Doss in Congressman Clay’s office at darrell.doss@mail.house.gov, or 202.225.2406.

cc:

Sincere regards,

Maxine Waters
Chairwoman

Wm. Lacy Clay
Chairman
HCDI Subcommittee


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[1] See, e.g., 12 C.F.R. § 323.3(b) (2018) (FDIC regulations; “For a transaction that does not require the services of a State certified or licensed appraiser under . . . this section, the institution shall obtain an appropriate evaluation of real property collateral that is consistent with safe and sound banking practices.”).

 

Sent from the Committee on Financial Services Democrats

2129 Rayburn House Office Building, Washington, DC 20515 | T (202) 225-4247

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