H. R. 4173—810
than 7 business days, after the receipt of a written request forsuch balance from or on behalf of the borrower.’’.
SEC. 1465. ESCROWS INCLUDED IN REPAYMENT ANALYSIS.

Section 128(b) of the Truth in Lending Act (15 U.S.C. 1638(b))
is amended by adding at the end the following new paragraph:‘‘(4) REPAYMENT ANALYSIS REQUIRED TO INCLUDE ESCROWPAYMENTS.—‘‘(A) IN GENERAL.—In the case of any consumer credit
transaction secured by a first mortgage or lien on theprincipal dwelling of the consumer, other than a consumer
credit transaction under an open end credit plan or areverse mortgage, for which an impound, trust, or othertype of account has been or will be established in connection
with the transaction for the payment of property taxes,
hazard and flood (if any) insurance premiums, or otherperiodic payments or premiums with respect to the property, the information required to be provided under subsection (a) with respect to the number, amount, and due
dates or period of payments scheduled to repay the totalof payments shall take into account the amount of any
monthly payment to such account for each such repayment
in accordance with section 10(a)(2) of the Real Estate
Settlement Procedures Act of 1974.
‘‘(B) ASSESSMENT VALUE.—The amount taken into
account under subparagraph (A) for the payment of property taxes, hazard and flood (if any) insurance premiums,
or other periodic payments or premiums with respect tothe property shall reflect the taxable assessed value ofthe real property securing the transaction after the consummation of the transaction, including the value of any
improvements on the property or to be constructed on
the property (whether or not such construction will befinanced from the proceeds of the transaction), if known,
and the replacement costs of the property for hazard insurance, in the initial year after the transaction.’’.

Subtitle F—Appraisal Activities
SEC. 1471. PROPERTY APPRAISAL REQUIREMENTS.

Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 etseq.) is amended by inserting after 129G (as added by section
1464(b)) the following new section:‘‘§ 129H. Property appraisal requirements‘‘(a) IN GENERAL.—A creditor may not extend credit in theform of a higher-risk mortgage to any consumer without firstobtaining a written appraisal of the property to be mortgaged
prepared in accordance with the requirements of this section.
‘‘(b) APPRAISAL REQUIREMENTS.—‘‘(1) PHYSICAL PROPERTY VISIT.—Subject to the rules prescribed under paragraph (4), an appraisal of property to be
secured by a higher-risk mortgage does not meet the requirement of this section unless it is performed by a certified or
licensed appraiser who conducts a physical property visit of
the interior of the mortgaged property.
‘‘(2) SECOND APPRAISAL UNDER CERTAIN CIRCUMSTANCES.—H. R. 4173—811‘‘(A) IN GENERAL.—If the purpose of a higher-risk mortgage is to finance the purchase or acquisition of the mortgaged property from a person within 180 days of the purchase or acquisition of such property by that person ata price that was lower than the current sale price of theproperty, the creditor shall obtain a second appraisal froma different certified or licensed appraiser. The second
appraisal shall include an analysis of the difference insale prices, changes in market conditions, and any improvements made to the property between the date of the previous sale and the current sale.
‘‘(B) NO COST TO APPLICANT.—The cost of any second
appraisal required under subparagraph (A) may not becharged to the applicant.
‘‘(3) CERTIFIED OR LICENSED APPRAISER DEFINED.—For purposes of this section, the term ‘certified or licensed appraiser’means a person who—‘‘(A) is, at a minimum, certified or licensed by theState in which the property to be appraised is located;
and‘‘(B) performs each appraisal in conformity with the
Uniform Standards of Professional Appraisal Practice andtitle XI of the Financial Institutions Reform, Recovery,and Enforcement Act of 1989, and the regulations prescribed under such title, as in effect on the date of theappraisal.
‘‘(4) REGULATIONS.—‘‘(A) IN GENERAL.—The Board, the Comptroller of theCurrency, the Federal Deposit Insurance Corporation, theNational Credit Union Administration Board, the Federal
Housing Finance Agency, and the Bureau shall jointly prescribe regulations to implement this section.
‘‘(B) EXEMPTION.—The agencies listed in subparagraph(A) may jointly exempt, by rule, a class of loans fromthe requirements of this subsection or subsection (a) if
the agencies determine that the exemption is in the public
interest and promotes the safety and soundness of creditors.
‘‘(c) FREE COPY OF APPRAISAL.—A creditor shall provide 1 copyof each appraisal conducted in accordance with this section inconnection with a higher-risk mortgage to the applicant withoutcharge, and at least 3 days prior to the transaction closing date.
‘‘(d) CONSUMER NOTIFICATION.—At the time of the initial mortgage application, the applicant shall be provided with a statementby the creditor that any appraisal prepared for the mortgage isfor the sole use of the creditor, and that the applicant may choose
to have a separate appraisal conducted at the expense of theapplicant.
‘‘(e) VIOLATIONS.—In addition to any other liability to any person under this title, a creditor found to have willfully failed toobtain an appraisal as required in this section shall be liable
to the applicant or borrower for the sum of $2,000.
‘‘(f) HIGHER-RISK MORTGAGE DEFINED.—For purposes of thissection, the term ‘higher-risk mortgage’ means a residential mortgage loan, other than a reverse mortgage loan that is a qualified
mortgage, as defined in section 129C, secured by a principal
dwelling—

H. R. 4173—812‘‘(1) that is not a qualified mortgage, as defined in section
129C; and‘‘(2) with an annual percentage rate that exceeds the average prime offer rate for a comparable transaction, as definedin section 129C, as of the date the interest rate is set—‘‘(A) by 1.5 or more percentage points, in the caseof a first lien residential mortgage loan having an original
principal obligation amount that does not exceed theamount of the maximum limitation on the original principal
obligation of mortgage in effect for a residence of theapplicable size, as of the date of such interest rate set,
pursuant to the sixth sentence of section 305(a)(2) the
Federal Home Loan Mortgage Corporation Act (12 U.S.C.
1454(a)(2));‘‘(B) by 2.5 or more percentage points, in the caseof a first lien residential mortgage loan having an original
principal obligation amount that exceeds the amount of
the maximum limitation on the original principal obligationof mortgage in effect for a residence of the applicable size,as of the date of such interest rate set, pursuant to thesixth sentence of section 305(a)(2) the Federal Home Loan
Mortgage Corporation Act (12 U.S.C. 1454(a)(2)); and‘‘(C) by 3.5 or more percentage points for a subordinate
lien residential mortgage loan.’’.
SEC. 1472. APPRAISAL INDEPENDENCE REQUIREMENTS.

(a) IN GENERAL.—Chapter 2 of the Truth in Lending Act (15U.S.C. 1631 et seq.) is amended by inserting after section 129D
(as added by section 1461(a)) the following new section:‘‘§ 129E. Appraisal independence requirements‘‘(a) IN GENERAL.—It shall be unlawful, in extending credit
or in providing any services for a consumer credit transaction
secured by the principal dwelling of the consumer, to engage inany act or practice that violates appraisal independence as describedin or pursuant to regulations prescribed under this section.
‘‘(b) APPRAISAL INDEPENDENCE.—For purposes of subsection (a),acts or practices that violate appraisal independence shall include—‘‘(1) any appraisal of a property offered as security forrepayment of the consumer credit transaction that is conductedin connection with such transaction in which a person withan interest in the underlying transaction compensates, coerces,
extorts, colludes, instructs, induces, bribes, or intimidates aperson, appraisal management company, firm, or other entity
conducting or involved in an appraisal, or attempts, to compensate, coerce, extort, collude, instruct, induce, bribe, or intimidate such a person, for the purpose of causing the appraisedvalue assigned, under the appraisal, to the property to be
based on any factor other than the independent judgment of
the appraiser;‘‘(2)mischaracterizing,or
suborninganymischaracterization of, the appraised value of the property
securing the extension of the credit;‘‘(3) seeking to influence an appraiser or otherwise toencourage a targeted value in order to facilitate the making
or pricing of the transaction; andH. R. 4173—813‘‘(4) withholding or threatening to withhold timely payment
for an appraisal report or for appraisal services rendered when
the appraisal report or services are provided for in accordancewith the contract between the parties.
‘‘(c) EXCEPTIONS.—The requirements of subsection (b) shall not
be construed as prohibiting a mortgage lender, mortgage broker,
mortgage banker, real estate broker, appraisal management company, employee of an appraisal management company, consumer,
or any other person with an interest in a real estate transaction
from asking an appraiser to undertake 1 or more of the following:‘‘(1) Consider additional, appropriate property information,
including the consideration of additional comparable properties
to make or support an appraisal.
‘‘(2) Provide further detail, substantiation, or explanation
for the appraiser’s value conclusion.
‘‘(3) Correct errors in the appraisal report.
‘‘(d) PROHIBITIONS ON CONFLICTS OF INTEREST.—No certified
or licensed appraiser conducting, and no appraisal managementcompany procuring or facilitating, an appraisal in connection witha consumer credit transaction secured by the principal dwellingof a consumer may have a direct or indirect interest, financial
or otherwise, in the property or transaction involving the appraisal.
‘‘(e) MANDATORY REPORTING.—Any mortgage lender, mortgage
broker, mortgage banker, real estate broker, appraisal managementcompany, employee of an appraisal management company, or any
other person involved in a real estate transaction involving anappraisal in connection with a consumer credit transaction securedby the principal dwelling of a consumer who has a reasonablebasis to believe an appraiser is failing to comply with the Uniform
Standards of Professional Appraisal Practice, is violating applicablelaws, or is otherwise engaging in unethical or unprofessional conduct, shall refer the matter to the applicable State appraiser certifying and licensing agency.
‘‘(f) NO EXTENSION OF CREDIT.—In connection with a consumer
credit transaction secured by a consumer’s principal dwelling, acreditor who knows, at or before loan consummation, of a violationof the appraisal independence standards established in subsections(b) or (d) shall not extend credit based on such appraisal unlessthe creditor documents that the creditor has acted with reasonablediligence to determine that the appraisal does not materially misstate or misrepresent the value of such dwelling.
‘‘(g) RULES AND INTERPRETIVE GUIDELINES.—‘‘(1) IN GENERAL.—Except as provided under paragraph(2), the Board, the Comptroller of the Currency, the Federal
Deposit Insurance Corporation, the National Credit Union
Administration Board, the Federal Housing Finance Agency,
and the Bureau may jointly issue rules, interpretive guidelines,
and general statements of policy with respect to acts or practices that violate appraisal independence in the provision ofmortgage lending services for a consumer credit transaction
secured by the principal dwelling of the consumer and mortgage
brokerage services for such a transaction, within the meaningof subsections (a), (b), (c), (d), (e), (f), (h), and (i).
‘‘(2) INTERIM FINAL REGULATIONS.—The Board shall, forpurposes of this section, prescribe interim final regulations
no later than 90 days after the date of enactment of thissection defining with specificity acts or practices that violate

H. R. 4173—814
appraisal independence in the provision of mortgage lending
services for a consumer credit transaction secured by the principal dwelling of the consumer or mortgage brokerage services
for such a transaction and defining any terms in this section
or such regulations. Rules prescribed by the Board under thisparagraph shall be deemed to be rules prescribed by the agencies jointly under paragraph (1).
‘‘(h) APPRAISAL REPORT PORTABILITY.—Consistent with therequirements of this section, the Board, the Comptroller of theCurrency, the Federal Deposit Insurance Corporation, the National
Credit Union Administration Board, the Federal Housing FinanceAgency, and the Bureau may jointly issue regulations that address
the issue of appraisal report portability, including regulations that
ensure the portability of the appraisal report between lenders fora consumer credit transaction secured by a 1-4 unit single family
residence that is the principal dwelling of the consumer, or mortgage
brokerage services for such a transaction.
‘‘(i) CUSTOMARY AND REASONABLE FEE.—‘‘(1) IN GENERAL.—Lenders and their agents shall compensate fee appraisers at a rate that is customary and reasonable for appraisal services performed in the market area ofthe property being appraised. Evidence for such fees may beestablished by objective third-party information, such as
government agency fee schedules, academic studies, and independent private sector surveys. Fee studies shall exclude
assignments ordered by known appraisal management companies.
‘‘(2) FEE APPRAISER DEFINITION.—For purposes of this section, the term ‘fee appraiser’ means a person who is not an
employee of the mortgage loan originator or appraisal management company engaging the appraiser and is—‘‘(A) a State licensed or certified appraiser who receives
a fee for performing an appraisal and certifies that theappraisal has been prepared in accordance with the Uniform Standards of Professional Appraisal Practice; or‘‘(B) a company not subject to the requirements ofsection 1124 of the Financial Institutions Reform, Recovery,and Enforcement Act of 1989 (12 U.S.C. 3331 et seq.)that utilizes the services of State licensed or certified
appraisers and receives a fee for performing appraisals
in accordance with the Uniform Standards of Professional
Appraisal Practice.
‘‘(3) EXCEPTION FOR COMPLEX ASSIGNMENTS.—In the caseof an appraisal involving a complex assignment, the customary
and reasonable fee may reflect the increased time, difficulty,
and scope of the work required for such an appraisal andinclude an amount over and above the customary and reasonable fee for non-complex assignments.
‘‘(j) SUNSET.—Effective on the date the interim final regulations
are promulgated pursuant to subsection (g), the Home Valuation
Code of Conduct announced by the Federal Housing Finance Agency
on December 23, 2008, shall have no force or effect.
‘‘(k) PENALTIES.—‘‘(1) FIRST VIOLATION.—In addition to the enforcement
provisions referred to in section 130, each person who violates
this section shall forfeit and pay a civil penalty of not morethan $10,000 for each day any such violation continues.

H. R. 4173—815‘‘(2) SUBSEQUENT VIOLATIONS.—In the case of any person
on whom a civil penalty has been imposed under paragraph(1), paragraph (1) shall be applied by substituting ‘$20,000’
for ‘$10,000’ with respect to all subsequent violations.
‘‘(3) ASSESSMENT.—The agency referred to in subsection(a) or (c) of section 108 with respect to any person describedin paragraph (1) shall assess any penalty under this subsection
to which such person is subject.’’.
(b) CLERICAL AMENDMENT.—The table of sections for chapter
2 of the Truth in Lending Act is amended by inserting after theitem relating to section 129D (as added by section 1461(c)) the
following new items:‘‘129E. Appraisal independence requirements.
‘‘129F. Requirements for prompt crediting of home loan payments.
‘‘129G. Requests for payoff amounts of home loan.
‘‘129H. Property appraisal requirements.’’.

(c) DEFERENCE.—Section 105 of the Truth in Lending Act (15U.S.C. 1604) is amended by adding at the end the following:‘‘(h) DEFERENCE.—Notwithstanding any power granted to any
Federal agency under this title, the deference that a court affords
to the Bureau with respect to a determination made by the Bureau
relating to the meaning or interpretation of any provision of thistitle, other than section 129E or 129H, shall be applied as if the
Bureau were the only agency authorized to apply, enforce, interpret,or administer the provisions of this title.’’.
(d) CONFORMING AMENDMENTS IN TITLE X NOT APPLICABLE
TO SECTIONS 129E AND 129H.—Notwithstanding section 1099A,
the term ‘‘Board’’ in sections 129E and 129H, as added by thissubtitle, shall not be substituted by the term ‘‘Bureau’’.
SEC. 1473. AMENDMENTS RELATING TO APPRAISAL SUBCOMMITTEEOF FFIEC, APPRAISER INDEPENDENCE MONITORING,APPROVED APPRAISER EDUCATION, APPRAISAL MANAGEMENT COMPANIES, APPRAISER COMPLAINT HOTLINE,
AUTOMATED VALUATION MODELS, AND BROKER PRICE
OPINIONS.

(a) THRESHOLD LEVELS.—Section 1112(b) of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989 (12U.S.C. 3341(b)) is amended by inserting before the period the following: ‘‘, and receives concurrence from the Bureau of Consumer
Financial Protection that such threshold level provides reasonable
protection for consumers who purchase 1–4 unit single-family residences’’.
(b) ANNUAL REPORT OF APPRAISAL SUBCOMMITTEE.—Section
1103(a) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3332(a)) is amended at the end byinserting the following new paragraph:‘‘(5) transmit an annual report to the Congress not later
than June 15 of each year that describes the manner in which
each function assigned to the Appraisal Subcommittee has been
carried out during the preceding year. The report shall alsodetail the activities of the Appraisal Subcommittee, including
the results of all audits of State appraiser regulatory agencies,
and provide an accounting of disapproved actions and warnings
taken in the previous year, including a description of the conditions causing the disapproval and actions taken to achievecompliance.’’.

H. R. 4173—816(c) OPEN MEETINGS.—Section 1104(b) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C.
3333(b)) is amended—(1) by inserting ‘‘in public session after notice in the Federal
Register, but may close certain portions of these meetings
related to personnel and review of preliminary State audit
reports,’’ after ‘‘shall meet’’; and(2) by adding after the final period the following: ‘‘The
subject matter discussed in any closed or executive session
shall be described in the Federal Register notice of themeeting.’’.
(d) REGULATIONS.—Section 1106 of the Financial Institutions
Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3335)
is amended—(1) by inserting ‘‘prescribe regulations in accordance withchapter 5 of title 5, United States Code (commonly referred
to as the Administrative Procedures Act) after notice and opportunity for comment,’’ after ‘‘hold hearings’’; and(2) at the end by inserting ‘‘Any regulations prescribedby the Appraisal Subcommittee shall (unless otherwise provided
in this title) be limited to the following functions: temporary
practice, national registry, information sharing, and enforcement. For purposes of prescribing regulations, the Appraisal
Subcommittee shall establish an advisory committee of industry
participants, including appraisers, lenders, consumer advocates,
real estate agents, and government agencies, and hold meetings
as necessary to support the development of regulations.’’.
(e) APPRAISAL REVIEWS AND COMPLEX APPRAISALS.—(1) SECTION 1110.—Section 1110 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C.
3339) is amended—(A) in paragraph (1), by striking ‘‘and’’;(B) in paragraph (2), by striking the period at theend and inserting ‘‘; and’’; and(C) by inserting after paragraph (2) the following:‘‘(3) that such appraisals shall be subject to appropriate
review for compliance with the Uniform Standards of Professional Appraisal Practice.’’.
(2) SECTION 1113.—Section 1113 of the Financial Institutions and Reform, Recovery, and Enforcement Act of 1989 (12U.S.C. 3342) is amended by inserting before the period thefollowing: ‘‘, where a complex 1-to-4 unit single family residential appraisal means an appraisal for which the property to
be appraised, the form of ownership, the property characteristics, or the market conditions are atypical’’.
(f) APPRAISAL MANAGEMENT SERVICES.—(1) SUPERVISION OF THIRD PARTY PROVIDERS OF APPRAISALMANAGEMENT SERVICES.—Section 1103(a) of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989
(12 U.S.C. 3332(a)) (as previously amended by this section)is amended—(A) by amending paragraph (1) to read as follows:‘‘(1) monitor the requirements established by States—‘‘(A) for the certification and licensing of individuals
who are qualified to perform appraisals in connection withfederally related transactions, including a code of professional responsibility; andH. R. 4173—817‘‘(B) for the registration and supervision of the operations and activities of an appraisal management company;’’; and(B) by adding at the end the following new paragraph:‘‘(6) maintain a national registry of appraisal managementcompanies that either are registered with and subject to supervision of a State appraiser certifying and licensing agency or
are operating subsidiaries of a Federally regulated financial
institution.’’.
(2) APPRAISAL MANAGEMENT COMPANY MINIMUM REQUIREMENTS.—Title XI of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3331 etseq.) is amended by adding at the end the following new section(and amending the table of contents accordingly):‘‘SEC. 1124. APPRAISAL MANAGEMENT COMPANY MINIMUM REQUIREMENTS.

‘‘(a) IN GENERAL.—The Board of Governors of the Federal
Reserve System, the Comptroller of the Currency, the Federal
Deposit Insurance Corporation, the National Credit Union Administration Board, the Federal Housing Finance Agency, and the Bureauof Consumer Financial Protection shall jointly, by rule, establish
minimum requirements to be applied by a State in the registrationof appraisal management companies. Such requirements shall
include a requirement that such companies—‘‘(1) register with and be subject to supervision by a Stateappraiser certifying and licensing agency in each State in whichsuch company operates;‘‘(2) verify that only licensed or certified appraisers areused for federally related transactions;‘‘(3) require that appraisals coordinated by an appraisal
management company comply with the Uniform Standards ofProfessional Appraisal Practice; and‘‘(4) require that appraisals are conducted independently
and free from inappropriate influence and coercion pursuant
to the appraisal independence standards established under section 129E of the Truth in Lending Act.
‘‘(b) RELATION TO STATE LAW.—Nothing in this section shallbe construed to prevent States from establishing requirements inaddition to any rules promulgated under subsection (a).
‘‘(c) FEDERALLY REGULATED FINANCIAL INSTITUTIONS.—The
requirements of subsection (a) shall apply to an appraisal management company that is a subsidiary owned and controlled by afinancial institution and regulated by a Federal financial institution
regulatory agency. An appraisal management company that is a
subsidiary owned and controlled by a financial institution regulated
by a Federal financial institution regulatory agency shall not be
required to register with a State.
‘‘(d) REGISTRATION LIMITATIONS.—An appraisal managementcompany shall not be registered by a State or included on thenational registry if such company, in whole or in part, directly
or indirectly, is owned by any person who has had an appraiser
license or certificate refused, denied, cancelled, surrendered in lieu
of revocation, or revoked in any State. Additionally, each personthat owns more than 10 percent of an appraisal management company shall be of good moral character, as determined by the Stateappraiser certifying and licensing agency, and shall submit to a

H. R. 4173—818
background investigation carried out by the State appraiser certifying and licensing agency.
‘‘(e) REPORTING.—The Board of Governors of the Federal
Reserve System, the Comptroller of the Currency, the Federal
Deposit Insurance Corporation, the National Credit Union Administration Board, the Federal Housing Finance Agency, and the Bureauof Consumer Financial Protection shall jointly promulgate regulations for the reporting of the activities of appraisal managementcompanies to the Appraisal Subcommittee in determining the payment of the annual registry fee.
‘‘(f) EFFECTIVE DATE.—‘‘(1) IN GENERAL.—No appraisal management company may
perform services related to a federally related transaction ina State after the date that is 36 months after the date on
which the regulations required to be prescribed under subsection (a) are prescribed in final form unless such company
is registered with such State or subject to oversight by a Federal
financial institutions regulatory agency.
‘‘(2) EXTENSION OF EFFECTIVE DATE.—Subject to theapproval of the Council, the Appraisal Subcommittee may
extend by an additional 12 months the requirements for theregistration and supervision of appraisal management companies if it makes a written finding that a State has madesubstantial progress in establishing a State appraisal management company registration and supervision system that appears
to conform with the provisions of this title.’’.
(3) STATE APPRAISER CERTIFYING AND LICENSING AGENCYAUTHORITY.—Section 1117 of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3346) isamended by adding at the end the following: ‘‘The duties ofsuch agency may additionally include the registration andsupervision of appraisal management companies and the addition of information about the appraisal management company
to the national registry.’’.
(4) APPRAISAL MANAGEMENT COMPANY DEFINITION.—Section
1121 of the Financial Institutions Reform, Recovery, andEnforcement Act of 1989 (12 U.S.C. 3350) is amended by adding
at the end the following:‘‘(11) APPRAISAL MANAGEMENT COMPANY.—The term
‘appraisal management company’ means, in connection withvaluing properties collateralizing mortgage loans or mortgages
incorporated into a securitization, any external third party
authorized either by a creditor of a consumer credit transaction
secured by a consumer’s principal dwelling or by an underwriterof or other principal in the secondary mortgage markets, thatoversees a network or panel of more than 15 certified or licensed
appraisers in a State or 25 or more nationally within a given
year—‘‘(A) to recruit, select, and retain appraisers;‘‘(B) to contract with licensed and certified appraisers
to perform appraisal assignments;‘‘(C) to manage the process of having an appraisal
performed, including providing administrative duties suchas receiving appraisal orders and appraisal reports, submitting completed appraisal reports to creditors and underwriters, collecting fees from creditors and underwriters forH. R. 4173—819
services provided, and reimbursing appraisers for services
performed; or‘‘(D) to review and verify the work of appraisers.’’.
(g) STATE AGENCY REPORTING REQUIREMENT.—Section 1109(a)of the Financial Institutions Reform, Recovery, and Enforcement
Act of 1989 (12 U.S.C. 3338(a)) is amended—(1) by striking ‘‘and’’ after the semicolon in paragraph(1);(2) by redesignating paragraph (2) as paragraph (4); and(3) by inserting after paragraph (1) the following new paragraphs:‘‘(2) transmit reports on the issuance and renewal oflicenses and certifications, sanctions, disciplinary actions,license and certification revocations, and license and certification suspensions on a timely basis to the national registryof the Appraisal Subcommittee;‘‘(3) transmit reports on a timely basis of supervisory activities involving appraisal management companies or other thirdparty providers of appraisals and appraisal management services, including investigations initiated and disciplinary actions
taken; and’’.
(h) REGISTRY FEES MODIFIED.—(1) IN GENERAL.—Section 1109(a) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C.
3338(a)) is amended—(A) by amending paragraph (4) (as modified by section
1473(g)) to read as follows:‘‘(4) collect—‘‘(A) from such individuals who perform or seek toperform appraisals in federally related transactions, anannual registry fee of not more than $40, such fees tobe transmitted by the State agencies to the Council onan annual basis; and‘‘(B) from an appraisal management company thateither has registered with a State appraiser certifying andlicensing agency in accordance with this title or operates
as a subsidiary of a federally regulated financial institution,an annual registry fee of—‘‘(i) in the case of such a company that has been
in existence for more than a year, $25 multiplied by
the number of appraisers working for or contractingwith such company in such State during the previous
year, but where such $25 amount may be adjusted,
up to a maximum of $50, at the discretion of the
Appraisal Subcommittee, if necessary to carry out the
Subcommittee’s functions under this title; and‘‘(ii) in the case of such a company that has notbeen in existence for more than a year, $25 multipliedby an appropriate number to be determined by the
Appraisal Subcommittee, and where such number will
be used for determining the fee of all such companies
that were not in existence for more than a year, butwhere such $25 amount may be adjusted, up to a
maximum of $50, at the discretion of the Appraisal
Subcommittee, if necessary to carry out the Subcommittee’s functions under this title.’’; andH. R. 4173—820(B) by amending the matter following paragraph (4),as redesignated, to read as follows:‘‘Subject to the approval of the Council, the Appraisal Subcommittee
may adjust the dollar amount of registry fees under paragraph(4)(A), up to a maximum of $80 per annum, as necessary to carryout its functions under this title. The Appraisal Subcommittee
shall consider at least once every 5 years whether to adjust the
dollar amount of the registry fees to account for inflation. In implementing any change in registry fees, the Appraisal Subcommittee
shall provide flexibility to the States for multi-year certifications
and licenses already in place, as well as a transition period to
implement the changes in registry fees. In establishing the amountof the annual registry fee for an appraisal management company,
the Appraisal Subcommittee shall have the discretion to impose
a minimum annual registry fee for an appraisal management company to protect against the under reporting of the number ofappraisers working for or contracted by the appraisal managementcompany.’’.
(2) INCREMENTAL REVENUES.—Incremental revenues collected pursuant to the increases required by this subsection
shall be placed in a separate account at the United States
Treasury, entitled the ‘‘Appraisal Subcommittee Account’’.
(i) GRANTS AND REPORTS.—Section 1109(b) of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989 (12U.S.C. 3338(b)) is amended—(1) by striking ‘‘and’’ after the semicolon in paragraph(3);(2) by striking the period at the end of paragraph (4)and inserting a semicolon;(3) by adding at the end the following new paragraphs:‘‘(5) to make grants to State appraiser certifying andlicensing agencies, in accordance with policies to be developedby the Appraisal Subcommittee, to support the efforts of suchagencies to comply with this title, including—‘‘(A) the complaint process, complaint investigations,and appraiser enforcement activities of such agencies; and‘‘(B) the submission of data on State licensed and certified appraisers and appraisal management companies to
the National appraisal registry, including information
affirming that the appraiser or appraisal management company meets the required qualification criteria and formal
and informal disciplinary actions; and‘‘(6) to report to all State appraiser certifying and licensing
agencies when a license or certification is surrendered, revoked,
or suspended.’’.
Obligations authorized under this subsection may not exceed 75
percent of the fiscal year total of incremental increase in feescollected and deposited in the ‘‘Appraisal Subcommittee Account’’pursuant to subsection (h).
(j) CRITERIA.—Section 1116 of the Financial Institutions
Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3345)
is amended—(1) in subsection (c), by inserting ‘‘whose criteria for the
licensing of a real estate appraiser currently meet or exceed
the minimum criteria issued by the Appraisal Qualifications
Board of The Appraisal Foundation for the licensing of realestate appraisers’’ before the period at the end; andH. R. 4173—821(2) by striking subsection (e) and inserting the following
new subsection:‘‘(e) MINIMUM QUALIFICATION REQUIREMENTS.—Any requirements established for individuals in the position of ‘Trainee
Appraiser’ and ‘Supervisory Appraiser’ shall meet or exceed theminimum qualification requirements of the Appraiser Qualifications
Board of The Appraisal Foundation. The Appraisal Subcommittee
shall have the authority to enforce these requirements.’’.
(k) MONITORING OF STATE APPRAISER CERTIFYING AND
LICENSING AGENCIES.—Section 1118 of the Financial Institutions
Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 3347)
is amended—(1) by amending subsection (a) to read as follows:‘‘(a) IN GENERAL.—The Appraisal Subcommittee shall monitor
each State appraiser certifying and licensing agency for the purposes of determining whether such agency—‘‘(1) has policies, practices, funding, staffing, and proceduresthat are consistent with this title;‘‘(2) processes complaints and completes investigations ina reasonable time period;‘‘(3) appropriately disciplines sanctioned appraisers andappraisal management companies;‘‘(4) maintains an effective regulatory program; and‘‘(5) reports complaints and disciplinary actions on a timely
basis to the national registries on appraisers and appraisal
management companies maintained by the Appraisal Subcommittee.
The Appraisal Subcommittee shall have the authority to remove
a State licensed or certified appraiser or a registered appraisal
management company from a national registry on an interim basis,
not to exceed 90 days, pending State agency action on licensing,certification, registration, and disciplinary proceedings. The
Appraisal Subcommittee and all agencies, instrumentalities, andFederally recognized entities under this title shall not recognize
appraiser certifications and licenses from States whose appraisal
policies, practices, funding, staffing, or procedures are found to
be inconsistent with this title. The Appraisal Subcommittee shallhave the authority to impose sanctions, as described in this section,
against a State agency that fails to have an effective appraiser
regulatory program. In determining whether such a program iseffective, the Appraisal Subcommittee shall include an analysisof the licensing and certification of appraisers, the registrationof appraisal management companies, the issuance of temporary
licenses and certifications for appraisers, the receiving and trackingof submitted complaints against appraisers and appraisal management companies, the investigation of complaints, and enforcement
actions against appraisers and appraisal management companies.
The Appraisal Subcommittee shall have the authority to impose
interim actions and suspensions against a State agency as analternative to, or in advance of, the derecognition of a State agency.’’.
(2) in subsection (b)(2), by inserting after ‘‘authority’’ thefollowing: ‘‘or sufficient funding’’.
(l) RECIPROCITY.—Subsection (b) of section 1122 of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989 (12U.S.C. 3351(b)) is amended to read as follows:‘‘(b) RECIPROCITY.—Notwithstanding any other provisions of
this title, a federally related transaction shall not be appraised

H. R. 4173—822
by a certified or licensed appraiser unless the State appraiser
certifying or licensing agency of the State certifying or licensing
such appraiser has in place a policy of issuing a reciprocal certification or license for an individual from another State when—‘‘(1) the appraiser licensing and certification program ofsuch other State is in compliance with the provisions of thistitle; and‘‘(2) the appraiser holds a valid certification from a State
whose requirements for certification or licensing meet or exceed
the licensure standards established by the State where an
individual seeks appraisal licensure.’’.
(m) CONSIDERATION OF PROFESSIONAL APPRAISAL DESIGNATIONS.—Section 1122(d) of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3351(d)) is
amended by striking ‘‘shall not exclude’’ and all that follows throughthe end of the subsection and inserting the following: ‘‘may include
education achieved, experience, sample appraisals, and referencesfrom prior clients. Membership in a nationally recognized professional appraisal organization may be a criteria considered, thoughlack of membership therein shall not be the sole bar against consideration for an assignment under these criteria.’’.
(n) APPRAISER INDEPENDENCE.—Section 1122 of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989 (12U.S.C. 3351) is amended by adding at the end the following new
subsection:‘‘(g) APPRAISER INDEPENDENCE MONITORING.—The Appraisal
Subcommittee shall monitor each State appraiser certifying andlicensing agency for the purpose of determining whether suchagency’s policies, practices, and procedures are consistent with the
purposes of maintaining appraiser independence and whether such
State has adopted and maintains effective laws, regulations, andpolicies aimed at maintaining appraiser independence.’’.
(o) APPRAISER EDUCATION.—Section 1122 of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989 (12U.S.C. 3351) is amended by inserting after subsection (g) (as added
by subsection (l) of this section) the following new subsection:‘‘(h) APPROVED EDUCATION.—The Appraisal Subcommittee shallencourage the States to accept courses approved by the Appraiser
Qualification Board’s Course Approval Program.’’.
(p) APPRAISAL COMPLAINT HOTLINE.—Section 1122 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989
(12 U.S.C. 3351), as amended by this section, is amended by adding
at the end the following new subsection:‘‘(i) APPRAISAL COMPLAINT NATIONAL HOTLINE.—If, 6 months
after the date of the enactment of this subsection, the Appraisal
Subcommittee determines that no national hotline exists to receive
complaints of non-compliance with appraisal independence standards and Uniform Standards of Professional Appraisal Practice,including complaints from appraisers, individuals, or other entities
concerning the improper influencing or attempted improper influencing of appraisers or the appraisal process, the Appraisal Subcommittee shall establish and operate such a national hotline, whichshall include a toll-free telephone number and an email address.
If the Appraisal Subcommittee operates such a national hotline,
the Appraisal Subcommittee shall refer complaints for further action
to appropriate governmental bodies, including a State appraiser
certifying and licensing agency, a financial institution regulator,

H. R. 4173—823
or other appropriate legal authorities. For complaints referred toState appraiser certifying and licensing agencies or to Federal regulators, the Appraisal Subcommittee shall have the authority tofollow up such complaint referrals in order to determine the statusof the resolution of the complaint.’’.
(q) AUTOMATED VALUATION MODELS.—Title XI of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989 (12U.S.C. 3331 et seq.), as amended by this section, is amended byadding at the end the following new section (and amending thetable of contents accordingly):‘‘SEC. 1125. AUTOMATED VALUATION MODELS USED TO ESTIMATECOLLATERAL VALUE FOR MORTGAGE LENDING PURPOSES.

‘‘(a) IN GENERAL.—Automated valuation models shall adhereto quality control standards designed to—‘‘(1) ensure a high level of confidence in the estimates
produced by automated valuation models;‘‘(2) protect against the manipulation of data;‘‘(3) seek to avoid conflicts of interest;‘‘(4) require random sample testing and reviews; and‘‘(5) account for any other such factor that the agencies
listed in subsection (b) determine to be appropriate.
‘‘(b) ADOPTION OF REGULATIONS.—The Board, the Comptrollerof the Currency, the Federal Deposit Insurance Corporation, theNational Credit Union Administration Board, the Federal Housing
Finance Agency, and the Bureau of Consumer Financial Protection,in consultation with the staff of the Appraisal Subcommittee andthe Appraisal Standards Board of the Appraisal Foundation, shallpromulgate regulations to implement the quality control standards
required under this section.
‘‘(c) ENFORCEMENT.—Compliance with regulations issued under
this subsection shall be enforced by—‘‘(1) with respect to a financial institution, or subsidiaryowned and controlled by a financial institution and regulated
by a Federal financial institution regulatory agency, the Federal
financial institution regulatory agency that acts as the primaryFederal supervisor of such financial institution or subsidiary;and‘‘(2) with respect to other participants in the market for
appraisals of 1-to-4 unit single family residential real estate,
the Federal Trade Commission, the Bureau of Consumer Financial Protection, and a State attorney general.
‘‘(d) AUTOMATED VALUATION MODEL DEFINED.—For purposesof this section, the term ‘automated valuation model’ means any
computerized model used by mortgage originators and secondary
market issuers to determine the collateral worth of a mortgage
secured by a consumer’s principal dwelling.’’.
(r) BROKER PRICE OPINIONS.—Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C.
3331 et seq.), as amended by this section, is amended by adding
at the end the following new section (and amending the tableof contents accordingly):‘‘SEC. 1126. BROKER PRICE OPINIONS.

‘‘(a) GENERAL PROHIBITION.—In conjunction with the purchaseof a consumer’s principal dwelling, broker price opinions may not
be used as the primary basis to determine the value of a piece

H. R. 4173—824
of property for the purpose of a loan origination of a residential
mortgage loan secured by such piece of property.
‘‘(b) BROKER PRICE OPINION DEFINED.—For purposes of thissection, the term ‘broker price opinion’ means an estimate preparedby a real estate broker, agent, or sales person that details theprobable selling price of a particular piece of real estate property
and provides a varying level of detail about the property’s condition,market, and neighborhood, and information on comparable sales,
but does not include an automated valuation model, as definedin section 1125(c).’’.
(s) AMENDMENTS TO APPRAISAL SUBCOMMITTEE.—Section 1011
of the Federal Financial Institutions Examination Council Act of1978 (12 U.S.C. 3310) is amended—(1) in the first sentence, by adding before the period thefollowing: ‘‘, the Bureau of Consumer Financial Protection, andthe Federal Housing Finance Agency’’; and(2) by inserting at the end the following: ‘‘At all times
at least one member of the Appraisal Subcommittee shall havedemonstrated knowledge and competence through licensure,certification, or professional designation within the appraisal
profession.’’.
(t) TECHNICAL CORRECTIONS.—(1) Section 1119(a)(2) of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3348(a)(2))
is amended by striking ‘‘council,’’ and inserting ‘‘Council,’’.
(2) Section 1121(6) of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3350(6))
is amended by striking ‘‘Corporations,’’ and inserting ‘‘Corporation,’’.
(3) Section 1121(8) of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3350(8))
is amended by striking ‘‘council’’ and inserting ‘‘Council’’.
(4) Section 1122 of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3351) is
amended—(A) in subsection (a)(1) by moving the left margin of
subparagraphs (A), (B), and (C) 2 ems to the right; and(B) in subsection (c)—(i) by striking ‘‘Federal Financial Institutions
Examination Council’’ and inserting ‘‘Financial Institutions Examination Council’’; and(ii) by striking ‘‘the council’s functions’’ andinserting ‘‘the Council’s functions’’.
SEC. 1474. EQUAL CREDIT OPPORTUNITY ACT AMENDMENT.

Subsection (e) of section 701 of the Equal Credit Opportunity
Act (15 U.S.C. 1691) is amended to read as follows:‘‘(e) COPIES FURNISHED TO APPLICANTS.—‘‘(1) IN GENERAL.—Each creditor shall furnish to an
applicant a copy of any and all written appraisals and valuations developed in connection with the applicant’s application
for a loan that is secured or would have been secured bya first lien on a dwelling promptly upon completion, but inno case later than 3 days prior to the closing of the loan,
whether the creditor grants or denies the applicant’s request
for credit or the application is incomplete or withdrawn.

H. R. 4173—825‘‘(2) WAIVER.—The applicant may waive the 3 day requirement provided for in paragraph (1), except where otherwise
required in law.
‘‘(3) REIMBURSEMENT.—The applicant may be required to
pay a reasonable fee to reimburse the creditor for the costof the appraisal, except where otherwise required in law.
‘‘(4) FREE COPY.—Notwithstanding paragraph (3), the creditor shall provide a copy of each written appraisal or valuation
at no additional cost to the applicant.
‘‘(5) NOTIFICATION TO APPLICANTS.—At the time of application, the creditor shall notify an applicant in writing of theright to receive a copy of each written appraisal and valuation
under this subsection.
‘‘(6) VALUATION DEFINED.—For purposes of this subsection,
the term ‘valuation’ shall include any estimate of the valueof a dwelling developed in connection with a creditor’s decision
to provide credit, including those values developed pursuant
to a policy of a government sponsored enterprise or by anautomated valuation model, a broker price opinion, or othermethodology or mechanism.’’.
SEC. 1475. REAL ESTATE SETTLEMENT PROCEDURES ACT OF 1974
AMENDMENT RELATING TO CERTAIN APPRAISAL FEES.

Section 4 of the Real Estate Settlement Procedures Act of1974 is amended by adding at the end the following new subsection:‘‘(c) The standard form described in subsection (a) may include,in the case of an appraisal coordinated by an appraisal managementcompany (as such term is defined in section 1121(11) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989
(12 U.S.C. 3350(11))), a clear disclosure of—‘‘(1) the fee paid directly to the appraiser by such company;
and‘‘(2) the administration fee charged by such company.’’.
SEC. 1476. GAO STUDY ON THE EFFECTIVENESS AND IMPACT OF VARIOUS APPRAISAL METHODS, VALUATION MODELS AND
DISTRIBUTIONS CHANNELS, AND ON THE HOME VALUATION CODE OF CONDUCT AND THE APPRAISAL SUBCOMMITTEE.

(a) IN GENERAL.—The Government Accountability Office shallconduct a study on—(1) the effectiveness and impact of—(A) appraisal methods, including the cost approach,the comparative sales approach, the income approach, andothers that may be available;(B) appraisal valuation models, including licensed andcertified appraisals, broker-priced opinions, and automatedvaluation models; and(C) appraisal distribution channels, including appraisal
management companies, independent appraisal operations
within mortgage originators, and fee-for-service appraisers;(2) the Home Valuation Code of Conduct; and(3) the Appraisal Subcommittee’s functions pursuant totitle XI of the Financial Institutions Reform, Recovery, andEnforcement Act of 1989.
(b) STUDY.—Not later than—(1) 12 months after the date of enactment of this Act,
the Government Accountability Office shall submit a study

H. R. 4173—826
to the Committee on Banking, Housing, and Urban Affairsof the Senate and the Committee on Financial Services ofthe House of Representatives; and(2) 90 days after the date of enactment of this Act, theGovernment Accountability Office shall provide a report on
the status of the study and any preliminary findings to theCommittee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on Financial Services of the Houseof Representatives.
(c) CONTENT OF STUDY.—The study required by this section
shall include an examination of the following:(1) APPRAISAL APPROACHES, VALUATION MODELS, AND DISTRIBUTION CHANNELS.—(A) The prevalence, alone or in combination, of certain
appraisal approaches, models, and channels in purchasemoney and refinance mortgage transactions.
(B) The accuracy of these approaches, models, andchannels in assessing the property as collateral.
(C) Whether and how these approaches, models, andchannels contributed to price speculation during the previous cycle.
(D) The costs to consumers of these approaches, models,and channels.
(E) The disclosure of fees to consumers in the appraisal
process.
(F) To what extent the usage of these approaches,models, and channels may be influenced by a conflict ofinterest between the mortgage lender and the appraiser
and the mechanism by which the lender selects and compensates the appraiser.
(G) The suitability of these approaches, models, andchannels in rural versus urban areas.
(2) HOME VALUATION CODE OF CONDUCT (HVCC).—(A) How the HVCC affects mortgage lenders’ selectionof appraisers.
(B) How the HVCC affects State regulation ofappraisers and appraisal distribution channels.
(C) How the HVCC affects the quality and cost ofappraisals and the length of time to obtain an appraisal.
(D) How the HVCC affects mortgage brokers, small
businesses, and consumers.
(d) ADDITIONAL STUDY REQUIRED.—(1) IN GENERAL.—Not later than 18 months after the dateof enactment of this Act, the Government Accountability Officeshall submit a study to the Committee on Banking, Housing,and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives.
(2) CONTENT OF ADDITIONAL STUDY.—The study required
under paragraph (1) shall include—(A) an examination of—(i) the Appraisal Subcommittee’s ability to monitor
and enforce State and Federal certification requirements and standards, including by providing a summary with a statistical breakdown of enforcement
actions taken during the last 10 years;

H. R. 4173—827(ii) whether existing Federal financial institutions
regulatory agency exemptions on appraisals for federally related transactions needs to be revised; and(iii) whether new means of data collection, suchas the establishment of a national repository, would
benefit the Appraisal Subcommittee’s ability to perform
its functions; and(B) recommendations from this examination foradministrative and legislative action at the Federal andState level.

Subtitle G—Mortgage Resolution and
Modification
SEC. 1481. MULTIFAMILY MORTGAGE RESOLUTION PROGRAM.

(a) ESTABLISHMENT.—The Secretary of Housing and Urban
Development shall develop a program under this subsection toensure the protection of current and future tenants and at-risk
multifamily properties, where feasible, based on criteria that may
include—(1) creating sustainable financing of such properties, that
may take into consideration such factors as—(A) the rental income generated by such properties;
and(B) the preservation of adequate operating reserves;(2) maintaining the level of Federal, State, and city subsidies in effect as of the date of the enactment of this Act;(3) providing funds for rehabilitation; and(4) facilitating the transfer of such properties, when appropriate and with the agreement of owners, to responsible newowners and ensuring affordability of such properties.
(b) COORDINATION.—The Secretary of Housing and Urban
Development may, in carrying out the program developed under
this section, coordinate with the Secretary of the Treasury, theFederal Deposit Insurance Corporation, the Board of Governorsof the Federal Reserve System, the Federal Housing FinanceAgency, and any other Federal Government agency that the Secretary considers appropriate.
(c) DEFINITION.—For purposes of this section, the term ‘‘multifamily properties’’ means a residential structure that consists of
5 or more dwelling units.
(d) PREVENTION OF QUALIFICATION FOR CRIMINAL APPLICANTS.—(1) IN GENERAL.—No person shall be eligible to begin
receiving assistance from the Making Home Affordable Program
authorized under the Emergency Economic Stabilization Act
of 2008 (12 U.S.C. 5201 et seq.), or any other mortgage assistance program authorized or funded by that Act, on or after
60 days after the date of the enactment of this Act, if such
person, in connection with a mortgage or real estate transaction,
has been convicted, within the last 10 years, of any one of
the following:(A) Felony larceny, theft, fraud, or forgery.
(B) Money laundering.
(C) Tax evasion.
(2) PROCEDURES.—The Secretary shall establish procedures
to ensure compliance with this subsection.