Massachusetts Gov. Charlie Baker recently signed state Rep. Thomas Stanley’s legislation, formerly House Bill 1114, that licenses appraisal management companies into law. The new law, Chapter 43 of the Acts of 2019, is supported by the Association for Valuation Professionals, appraisal management companies, mortgage industry professionals and real estate appraisers.
Without passage of the bill, AMCs would have been prohibited from operating in the state, impacting everyone looking to buy a home or refinancing a mortgage, the Wicked Local/Waltham News Tribune reported.
“Requiring the licensing of appraisal management companies is driven by consumer concerns. Appraiser independence requirements were established in Dodd-Frank to halt the inordinate pressure from lenders that was placed upon appraisers to reach a pre-determined value that would make a home loan work,” the newspaper said.
Stanley told the paper he understood the importance of independence in the appraisal process.
“Appraiser independence is vital to both safety and soundness of financial institutions, and to consumers who regularly rely on appraisals obtained by lenders to determine if the price they are paying for a house is reasonable,” Stanley told the newspaper. “With more than 80 percent of all Massachusetts residential appraisal orders processed by AMCs, the Commonwealth’s economy would have been negatively disrupted as well.”