Appraiser News
Leagues echo CUNA support of NCUA’s appraisal proposal
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Appraiser News
Wednesday, February 19, 2020
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The Credit Union National Association (CUNA) recently wrote in support of the National Credit Union Administration (NCUA’s) proposal to raise the residential appraisal threshold in early January, as CUNA originally requested the rule to give credit unions parity with banks. Several credit union leagues around the country also wrote to NCUA in support of the proposal, the CUNA letter states.
Specifically, NCUA proposed to raise the amount for which residential appraisal threshold would be increased to $400,000 (from the current $250,000).
CUNA, in its comment letter, noted the change would “reduce regulatory burden for credit unions, resulting in both transaction cost and time savings for credit unions and their members.”
League comments on the proposal include:
- Wisconsin Credit Union League: “The League urges the NCUA to increase its residential appraisal threshold to $400,000 as quickly as possible, since federal regulators did the same for banks last October and FICUs are now at a competitive disadvantage. The increase would not adversely affect either credit unions or consumers. In fact, the change would save consumers both time and money, while reducing the regulatory burden for FICUs. Consumers would still have significant protections, since transactions below $400,000 would continue to require written estimates of market value prepared by qualified, competent, and independent individuals using appropriate supporting information.”
- Cooperative Credit Union Association: “The proposed rule seeks to provide a measure of regulatory relief to affected credit unions while protecting consumers in real estate transactions. The Association supports the proposed increase in the appraisal threshold with additional comments set forth in this letter to help ensure the final rule is well-balanced and fair for both consumers and credit unions.”
- Indiana Credit Union League: “The ICUL and our affiliated credit unions strongly support the proposal to increase the threshold level below which appraisals would not be required for residential real estate-related transactions from $250,000 to $400,000. We believe that it is important that credit unions not remain at a competitive disadvantage to other federally insured institutions whose regulatory agencies have already increased the threshold to $400,000. The Consumer Financial Protection Bureau (CFPB) has also approved this increase for the other federal regulators. We encourage NCUA to develop and approve a final rule to increase the threshold as quickly as possible.”
- Credit Union Association of the Dakotas: “CUAD believes $400,000 is an appropriate level for the
residential appraisal threshold. Furthermore, we urge the NCUA to finalize this increase swiftly as it will save the consumer unnecessary expense for appraisals for residential real estate transactions under $400,000. Obtaining appraisals in rural states such as North and South Dakota has added cost and time for consumers to obtain homeownership. CUAD believes the proposed threshold increase will lead to cost savings for most importantly the borrower and federally insured credit unions.”
- Heartland Credit Union Association: “We support increasing the current threshold to at least $400,000. The time and expense associated with residential appraisals is often significant for homebuyers; increasing the threshold to at least $400,000 will have a substantial benefit on credit union members seeking to obtain a mortgage. Such action would also address a competitive disadvantage that was created when federal banking regulators recently raised this threshold for banks to $400,000.”
- Ohio Credit Union League: “OCUL frequently hears from credit unions regarding the market scarcity of appraisers. In rural and suburban markets, the lack of appraisers forces credit unions to obtain real estate appraisals from firms outside of their market area which may result in greater cost and time delays…Whether the scarcity of appraisers is due to liability concerns, competition related to apprentice hours, or population shifts, NCUA’s proposal is a positive step towards addressing this issue as it would provide relief for credit unions to utilize alternative valuation methods.”
- League of Southeastern Credit Unions and Affiliates: “We support the proposed rule change and think that it will provide credit unions more flexibility in their mortgage lending operations. It will also help credit unions stay competitive with banks in regards to the appraisal threshold, and can decrease costs and time for consumers in the process of purchasing a home. What’s more, it does not pose an undue risk to Share Insurance Fund or the credit union industry.”
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