![[logo] US EPA](http://www.epa.gov/epafiles/images/logo_epaseal.gif){kind=logo}
Appraiser Qualifications for Placement on FHA Single Family Appraiser Roster
Note: EPA no longer updates this information, but it may be useful as a reference or resource.
[Federal Register: November 30, 2001 (Volume 66, Number 231)]
[Proposed Rules]
[Page 60127-60130]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr30no01-51]
-----------------------------------------------------------------------
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 200
[Docket No. FR-4620-P-01]
RIN 2502-AH59
Appraiser Qualifications for Placement on FHA Single Family
Appraiser Roster
AGENCY: Office of the Assistant Secretary for Housing--Federal Housing
Commissioner, HUD.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: This proposed rule would make several regulatory changes
designed to strengthen the licensing and certification requirements for
placement on the FHA Appraiser Roster. First, the proposed rule would
require that appraisers on the Appraiser Roster must have professional
credentials that are based on the minimum licensing/certification
standards issued by the Appraiser Qualifications Board of the Appraisal
Foundation. The proposed rule also clarifies that an appraiser may be
removed from the Appraiser Roster if the appraiser loses his or her
license or certification in any state due to disciplinary action, even
if the appraiser continues to be licensed or certified in another
state. Finally, the proposed rule provides that an appraiser who is
licensed or certified in a single state and whose license or
certification has expired, or has been revoked, suspended or
surrendered as a result of a state disciplinary action, will be
automatically suspended from the Appraiser Roster until HUD receives
evidence demonstrating renewal or that the state imposed sanction has
been lifted.
DATES: Comments Due Date: January 29, 2002.
ADDRESSES: Interested persons are invited to submit comments regarding
this proposed rule to the Regulations Division, Office of General
Counsel, Room 10276, Department of Housing and Urban Development, 451
Seventh Street, SW., Washington, DC 20410-0500. Communications should
refer to the above docket number and title. Facsimile (FAX) comments
are not acceptable. A copy of each communication submitted will be
available for public inspection and copying between 7:30 am and 5:30 pm
weekdays at the above address.
FOR FURTHER INFORMATION CONTACT: Vance T. Morris, Director, Office of
Single Family Program Development, Room 9266, U.S. Department of
Housing and Urban Development, 451 Seventh Street, SW., Washington, DC
20410-8000; telephone (202) 708-2121 (this is not a toll-free number).
Hearing- or speech-impaired individuals may access this number via TTY
by calling the toll-free Federal Information Relay Service at 1-800-
877-8339.
SUPPLEMENTARY INFORMATION:
I. Background
HUD has taken various steps to ensure the integrity of Federal
Housing Administration (FHA) appraisals. In August 1999, HUD launched
dramatic and comprehensive reforms of the FHA appraisal process through
its Homebuyer Protection Plan. The purpose of these reforms is to
ensure that homebuyers seeking FHA-insured mortgages receive accurate
and complete appraisals of the homes they seek to purchase. As part of
the Homebuyer Protection Plan, HUD has established regulatory placement
and removal procedures for the FHA Appraiser Roster. These procedures
are codified in subpart G of HUD's regulations at 24 CFR part 200
(consisting of Secs. 200.200--200.206).
HUD's Appraiser Roster lists those appraisers who are eligible to
perform FHA single family appraisals. HUD maintains the Appraiser
Roster to provide a means by which HUD can monitor the quality of
appraisals performed on single family homes financed through the FHA
single family programs and to ensure that appraisers performing FHA
appraisals meet high competency standards. The Appraiser Roster is an
important part of the FHA Single Family Mortgage Insurance program
because accurate appraisals are vital to the success of the program and
HUD's ability to protect the FHA Insurance Fund.
This proposed rule would make several regulatory changes that are
designed to strengthen the FHA Appraiser Roster licensing and
certification requirements. First, the proposed rule would amend
Sec. 200.202, which requires that an applicant for placement on the
Appraiser Roster must be a state-licensed or state-certified appraiser.
The proposed rule would require that the state licensed or certified
appraiser have professional credentials that are based on the minimum
licensing/certification standards issued by the Appraiser
Qualifications Board (AQB) of the Appraisal Foundation. HUD believes
that the proposed amendment will help to ensure that appraisers on the
Appraiser Roster meet high competency standards, thereby improving the
quality and accuracy of their FHA appraisals. For purposes of the rule,
an appraiser would not be deemed to have professional credentials based
on AQB standards if the state licensing/certification requirements did
not conform to AQB criteria at the time the appraiser obtained the
license or certification. This is true even if the state has
subsequently adopted AQB criteria and has ``grandfathered'' previously
licensed or certified appraisers.
The proposed rule would also amend Sec. 200.204, which describes
the actions HUD may take against an appraiser on the Appraiser Roster
that does not meet HUD's established guidelines for performance,
education, competency, and other professional criteria. Specifically,
the proposed rule clarifies that an appraiser may be removed from the
Appraiser Roster if the appraiser loses his or her license or
certification in any state due to disciplinary action, even if the
appraiser continues to be licensed or certified in another state. The
proposed rule would also provide that an appraiser who is licensed or
certified in a single state and whose state license or certification
has expired, or has been revoked, suspended or surrendered as a result
of a state disciplinary action, will be automatically suspended from
the Appraiser Roster and prohibited from conducting FHA appraisals
until HUD receives evidence demonstrating renewal or that the state
imposed sanction has been lifted.
II. Findings and Certifications
Regulatory Planning and Review
The Office of Management and Budget (OMB) reviewed this rule under
Executive Order 12866, Regulatory Planning and Review. OMB determined
that this proposed rule is a ``significant regulatory action'' as
defined in section 3(f) of the Order (although not an economically
significant regulatory action under the Order). Any changes made to
this rule as a result of that review are identified in the docket file,
which is available for public inspection in the office of the
Department's Rules Docket Clerk, Room 10276, 451 Seventh Street, SW.,
Washington, DC 20410-0500.
Public Reporting Burden
The information collection requirements for the FHA Appraiser
Roster have been approved by the Office of Management and Budget (OMB)
under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) and
have been assigned OMB control number 2502-0538. In accordance with the
Paperwork Reduction Act, HUD may not
[[Page 60129]]
conduct or sponsor, and a person is not required to respond to, a
collection of information unless the collection displays a currently
valid OMB control number.
Environmental Impact
This proposed rule does not direct, provide for assistance or loan
and mortgage insurance for, or otherwise govern or regulate, real
property acquisition, disposition, leasing, rehabilitation, alteration,
demolition, or new construction, or establish, revise, or provide for
standards for construction or construction materials, manufactured
housing, or occupancy. Accordingly, under 24 CFR 50.19(c)(1), this
proposed rule is categorically excluded from environmental review under
the National Environmental Policy Act of 1969 (42 U.S.C. 4321).
Regulatory Flexibility Act
The Secretary has reviewed this proposed rule before publication,
and by approving it certifies, in accordance with the Regulatory
Flexibility Act (5 U.S.C. 605(b)), that this proposed rule would not
have a significant economic impact on a substantial number of small
entities. The reasons for HUD's determination are as follows.
The proposed rule would require that appraisers on the Appraiser
Roster have professional credentials that are based on the minimum
licensing/certification standards issued by the Appraiser
Qualifications Board (AQB) of the Appraisal Foundation. An analysis of
the FHA Appraiser Roster indicates that of the approximately 22,163
appraisers currently on the Roster, only approximately 330 do not have
licensing in conformance with the standards issued by the AQB. In most
instances, these appraisers already have some of the hours of education
or experience required to meet the AQB criteria, thus further
minimizing the impacts of the proposed rule. For example, most
appraisers on the Roster have been listed on the Roster for some time,
and thus few of these appraisers will have difficulty providing
evidence to their state board demonstrating acceptable experience
levels. With regards to the education requirements, the AQB standards
only require 120 hours of education for certification. Given the few
number of appraisers currently on the Roster who do not have a state
designation based on AQB criteria and the relative low time and expense
that would be required for most of these appraisers to meet AQB
criteria, HUD believes that the proposed rule will not have a
significant economic impact on small entities.
In addition to the new AQB standards, the proposed rule also
clarifies that an appraiser may be removed from the Appraiser Roster if
the appraiser loses his or her license or certification in any state
due to disciplinary action, even if the appraiser continues to be
licensed or certified in another state. The proposed rule would also
provide that an appraiser who is licensed or certified in a single
state and whose state license or certification has expired, or has been
revoked, suspended or surrendered as a result of a state disciplinary
action, will be automatically suspended from the Appraiser Roster and
prohibited from conducting FHA appraisals until HUD receives evidence
demonstrating renewal or that the state imposed sanction has been
lifted. To the extent that these changes have an impact on small
entities it will be as a result of actions taken by the appraisers
themselves--that is, violation of applicable standards resulting in
disciplinary action or otherwise failing to maintain their professional
state licensing or certification.
Notwithstanding HUD's determination that this rule will not have a
significant economic effect on a substantial number of small entities,
HUD specifically invites comments regarding any less burdensome
alternatives to this rule that will meet HUD's objectives as described
in this preamble.
Executive Order 13132, Federalism
Executive Order 13132 (entitled ``Federalism'') prohibits an agency
from publishing any rule that has federalism implications if the rule
either imposes substantial direct compliance costs on state and local
governments and is not required by statute, or the rule preempts state
law, unless the agency meets the consultation and funding requirements
of section 6 of the Executive Order. This proposed rule would not have
federalism implications and would not impose substantial direct
compliance costs on state and local governments or preempt state law
within the meaning of the Executive Order.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C.
1531-1538) establishes requirements for Federal agencies to assess the
effects of their regulatory actions on state, local, and tribal
governments, and on the private sector. This proposed rule would not
impose any Federal mandates on any state, local, or tribal governments,
or on the private sector, within the meaning of the Unfunded Mandates
Reform Act of 1995.
List of Subjects in 24 CFR Part 200
Administrative practice and procedure, Claims, Equal employment
opportunity, Fair housing, Home improvement, Housing standards,
Incorporation by reference, Lead poisoning, Loan programs--housing and
community development, Minimum property standards, Mortgage insurance,
Organization and functions (Government agencies), Penalties, Reporting
and recordkeeping requirements, Social security, Unemployment
compensation, Wages.
Accordingly, for the reasons discussed in the preamble, HUD
proposes to amend 24 CFR part 200 as follows:
PART 200--INTRODUCTION TO FHA PROGRAMS
1. The authority citation for 24 CFR part 200 continues to read as
follows:
Authority: 12 U.S.C. 1701-1715z-18; 42 U.S.C. 3535(d).
Subpart G--Appraiser Roster
2. Revise Sec. 200.202(b)(1) to read as follows:
Sec. 200.202 How do I apply for placement on the Appraiser Roster?
* * * * *
(b) * * *
(1) You must be a state-licensed or state-certified appraiser with
professional credentials based on the minimum licensing/certification
criteria issued by the Appraiser Qualifications Board (AQB) of the
Appraisal Foundation (for purposes of this section, an appraiser is not
deemed to have professional credentials based on AQB standards if the
state licensing/certification requirements did not conform to AQB
criteria at the time the appraiser obtained the license or
certification. This is true even if the state has subsequently adopted
AQB criteria and has ``grandfathered'' previously licensed or certified
appraisers).
* * * * *
3. Amend Sec. 200.204 as follows:
a. Revise paragraph (a)(1);
b. Redesignate paragraphs (c) and (d) as paragraphs (d) and (e)
respectively; and
c. Add new paragraph (c):
Sec. 200.204 What actions may HUD take against unsatisfactory
appraisers on the Appraiser Roster?
* * * * *
(a) * * *
[[Page 60130]]
(1) Cause for removal. Cause for removal includes, but is not
limited to:
(i) Significant deficiencies in appraisals, including non-
compliance with Civil Rights requirements regarding appraisals;
(ii) Losing standing as a state-certified or state-licensed
appraiser due to disciplinary action in any state in which the
appraiser is certified or licensed;
(iii) Prosecution for committing, attempting to commit, or
conspiring to commit fraud, misrepresentation, or any other offense
that may reflect on the appraiser's character or integrity;
(iv) Failure to perform appraisal functions in accordance with
instructions and standards issued by HUD;
(v) Failure to comply with any agreement made between the appraiser
and HUD or with any certification made by the appraiser;
(vi) Being issued a final debarment, suspension, or limited denial
of participation;
(vii) Failure to maintain eligibility requirements for placement on
the Appraiser Roster as set forth under this subpart or any other
instructions or standards issued by HUD; or
(viii) Failure to comply with HUD-imposed education requirements
under paragraph (d) of this section within the specified period for
complying with such education requirements.
* * * * *
(c) Automatic suspension from Appraiser Roster. An appraiser who is
licensed or certified in a single state and whose state licensing or
certification has expired, or has been revoked, suspended or
surrendered as a result of a state disciplinary action, is
automatically suspended from the Appraiser Roster and prohibited from
conducting FHA appraisals until HUD receives evidence demonstrating
renewal or that the state imposed sanction has been lifted.
* * * * *
Dated: September 10, 2001.
John C. Weicher,
Assistant Secretary for, Housing-Federal Housing Commissioner.
[FR Doc. 01-29681 Filed 11-29-01; 8:45 am]
BILLING CODE 4210-27-P