For the third time this week, a new rule in the post Dodd-Frank era comes down to haunt mortgage lenders. This time, the Board of Governors of the Federal Reserve, the Consumer Financial Protection Bureau, Federal Deposit Insurance Corporation, Federal Housing Finance Agency, National Credit Union Administration and the Comptroller of the Currency all worked together to create a rule that governs appraisals on collateral for Higher-Price Mortgages.
The two main provisions (how are there only 2 in a 333 page rule??) are 1) that lender must disclose information about the purpose of the appraisal to the mortgage applicant and provide them with a free copy of any appraisal report and 2) in a flip situation, a second appraisal is required, at the cost of the lender, if the price has gone up 10% in 90 days or 20% in 180 days.
It is difficult to see how it took that many agencies that long to document something with more exceptions that main features, including bridge loans, manufactured homes, mobile homes, qualified mortgages and any loan in a rural area.
For your reading pleasure, Full release here. Full rule here.