156 
(1) by inserting ‘‘prescribe regulations after no-
tice and opportunity for comment,’’ after ‘‘hold hear-
ings’’; and 
(2) at the end by inserting ‘‘Any regulations pre-
scribed by the Appraisal Subcommittee shall (unless 
otherwise provided in this title) be limited to the fol-
lowing functions: temporary practice, national reg-
istry, information sharing, and enforcement. For pur-
poses of prescribing regulations, the Appraisal Sub-
committee shall establish an advisory committee of in-
dustry participants, including appraisers, lenders, 
consumer advocates, and government agencies, and 
hold meetings as necessary to support the development 
of regulations.’’. 
(e) FIELD APPRAISALS AND APPRAISAL REVIEWS.— 
Section 1113 of the Financial Institutions Reform, Recov-
ery, and Enforcement Act of 1989 (12 U.S.C. 3342) is 
amended— 
(1) by striking ‘‘In determining’’ and inserting 
‘‘(a) IN GENERAL.—In determining’’; 
(2) in subsection (a) (as designated by para-
graph (1)), by inserting before the period the fol-
lowing: ‘‘, 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, 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00156
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
157 
the property characteristics, or the market conditions 
are atypical’’; and 
(3) by adding at the end the following new sub-
section: 
‘‘(b) APPRAISALS AND APPRAISAL REVIEWS.—All ap-
praisals performed at a property within a State shall be 
prepared by appraisers licensed or certified in the State 
where the property is located. All appraisal reviews, includ-
ing appraisal reviews by a lender, appraisal management 
company, or other third party organization, shall be per-
formed by an appraiser who is duly licensed or certified 
by a State appraisal board.’’. 
(f) APPRAISAL MANAGEMENT SERVICES.— 
(1) SUPERVISION OF THIRD PARTY PROVIDERS 
OF
APPRAISAL
MANAGEMENT
SERVICES.—Section 
1103(a) of the Financial Institutions Reform, Recov-
ery, and Enforcement Act of 1989 (12 U.S.C. 
3332(a)) (as previously amended by this section) is 
further 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 ap-
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00157
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
158 
praisals in connection with federally related 
transactions, including a code of professional re-
sponsibility; and 
‘‘(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: 
‘‘(7) maintain a national registry of appraisal 
management companies that either are registered with 
and subject to supervision of a State appraiser certi-
fying and licensing agency or are operating subsidi-
aries of a Federally regulated financial institution.’’. 
(2) APPRAISAL MANAGEMENT COMPANY MINIMUM 
QUALIFICATIONS.—Title XI of the Financial Institu-
tions Reform, Recovery, and Enforcement Act of 1989 
(12 U.S.C. 3331 et seq.) is amended by adding at the 
end the following new section (and amending the 
table of contents accordingly): 
‘‘SEC. 1124. APPRAISAL MANAGEMENT COMPANY MINIMUM 
QUALIFICATIONS. 
‘‘(a) IN GENERAL.—The Appraiser Qualifications 
Board of the Appraisal Foundation shall establish min-
imum qualifications to be applied by a State in the reg-
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00158
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
159 
istration of appraisal management companies. Such quali-
fications shall include a requirement that such companies— 
‘‘(1) register with and be subject to supervision 
by a State appraiser certifying and licensing agency 
in each State in which such company operates; 
‘‘(2) verify that only licensed or certified ap-
praisers are used for federally related transactions; 
‘‘(3) require that appraisals coordinated by an 
appraisal management company comply with the 
Uniform Standards of Professional Appraisal Prac-
tice; and 
‘‘(4) require that appraisals are conducted inde-
pendently and free from inappropriate influence and 
coercion pursuant to the appraisal independence 
standards established under section 129E of the Truth 
in Lending Act. 
‘‘(b) EXCEPTION FOR FEDERALLY REGULATED FINAN-
CIAL INSTITUTIONS.—The requirements of subsection (a) 
shall not apply to an appraisal management company that 
is a subsidiary owned and controlled by a financial institu-
tion and regulated by a federal financial institution regu-
latory agency. In such case, the appropriate federal finan-
cial institutions regulatory agency shall, at a minimum, 
develop regulations affecting the operations of the appraisal 
management company to— 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00159
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
160 
‘‘(1) verify that only licensed or certified ap-
praisers are used for federally related transactions; 
‘‘(2) require that appraisals coordinated by an 
institution or subsidiary providing appraisal man-
agement services comply with the Uniform Standards 
of Professional Appraisal Practice; and 
‘‘(3) require that appraisals are conducted inde-
pendently and free from inappropriate influence and 
coercion pursuant to the appraisal independence 
standards established under section 129E of the Truth 
in Lending Act. 
‘‘(c) REGISTRATION
LIMITATIONS.—An appraisal 
management company shall not be registered by a State 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 
person that owns more than 10 percent of an appraisal 
management company shall be of good moral character, as 
determined by the State appraiser certifying and licensing 
agency, and shall submit to a background investigation car-
ried out by the State appraiser certifying and licensing 
agency. 
‘‘(d) REGULATIONS.—The Appraisal Subcommittee 
shall promulgate regulations to implement the minimum 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00160
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
162 
(3) STATE APPRAISER CERTIFYING AND LICENS-
ING AGENCY AUTHORITY.—Section 1117 of the Finan-
cial Institutions Reform, Recovery, and Enforcement 
Act of 1989 (12 U.S.C. 3346) is amended by adding 
at the end the following: ‘‘The duties of such agency 
may additionally include the registration and super-
vision of appraisal management companies.’’. 
(4) APPRAISAL MANAGEMENT COMPANY DEFINI-
TION.—Section 1121 of the Financial Institutions Re-
form, Recovery, and Enforcement Act of 1989 (12 
U.S.C. 3350) is amended by adding at the end the fol-
lowing: 
‘‘(11) APPRAISAL MANAGEMENT COMPANY.—The 
term ‘appraisal management company’ means, in 
connection with valuing properties collateralizing 
mortgage loans or mortgages incorporated into a 
securitization, any external third party authorized ei-
ther by a creditor of a consumer credit transaction se-
cured by a consumer’s principal dwelling or by an 
underwriter of or other principal in the secondary 
mortgage markets, that oversees a network or panel of 
more than 10 certified or licensed appraisers in a 
State or 25 or more nationally within a given year— 
‘‘(A) to recruit, select, and retain apprais-
ers; 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00162
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
163 
‘‘(B) to contract with licensed and certified 
appraisers to perform appraisal assignments; 
‘‘(C) to manage the process of having an 
appraisal performed, including providing ad-
ministrative duties such as receiving appraisal 
orders and appraisal reports, submitting com-
pleted appraisal reports to creditors and under-
writers, collecting fees from creditors and under-
writers for services provided, and reimbursing 
appraisers for services performed; or 
‘‘(D) to review and verify the work of ap-
praisers.’’. 
(g) STATE AGENCY REPORTING REQUIREMENT.—Sec-
tion 1109(a) of the Financial Institutions Reform, Recov-
ery, 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 para-
graph (4); and 
(3) by inserting after paragraph (1) the fol-
lowing new paragraphs: 
‘‘(2) transmit reports on sanctions, disciplinary 
actions, license and certification revocations, and li-
cense and certification suspensions on a timely basis 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00163
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
164 
to the national registry of the Appraisal Sub-
committee; 
‘‘(3) transmit reports on a timely basis of super-
visory activities involving appraisal management 
companies or other third-party providers of apprais-
als and appraisal management services, including in-
vestigations initiated and disciplinary actions taken; 
and’’. 
(h) REGISTRY FEES MODIFIED.— 
(1) IN GENERAL.—Section 1109(a) of the Finan-
cial Institutions Reform, Recovery, and Enforcement 
Act of 1989 (12 U.S.C. 3338(a)) is amended— 
(A) by amending paragraph (4) (as modi-
fied by section 603(g) of this Act) to read as fol-
lows: 
‘‘(4) collect— 
‘‘(A) from such individuals who perform or 
seek to perform appraisals in federally related 
transactions, an annual registry fee of not more 
than $40, such fees to be transmitted by the 
State agencies to the Council on an annual 
basis; and 
‘‘(B) from an appraisal management com-
pany that either has registered with a State ap-
praiser certifying and licensing agency in ac-
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00164
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
165 
cordance with this title or operates as a sub-
sidiary of a federally regulated financial institu-
tion, 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 contracting with such com-
pany 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 not been in existence for more than 
a year, $25 multiplied by 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, 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 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00165
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
166 
Subcommittee’s functions under this title.’’; 
and 
(B) by amending the matter following para-
graph (4), as redesignated, to read as follows: 
‘‘Subject to the approval of the Council, the Appraisal Sub-
committee may adjust the dollar amount of registry fees 
under paragraph (4)(A), up to a maximum of $80 per 
annum, as necessary to carry out 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 certifi-
cations and licenses already in place, as well as a transition 
period to implement the changes in registry fees. In estab-
lishing the amount of the annual registry fee for an ap-
praisal management company, the Appraisal Subcommittee 
shall have the discretion to impose a minimum annual reg-
istry fee for an appraisal management company to protect 
against the under reporting of the number of appraisers 
working for or contracted by the appraisal management 
company.’’. 
(2) INCREMENTAL REVENUES.—Incremental rev-
enues collected pursuant to the increases required by 
this subsection shall be placed in a separate account 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00166
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
167 
at the United States Treasury, entitled the ‘‘Ap-
praisal Subcommittee Account’’. 
(i) GRANTS AND REPORTS.—Section 1109(b) of the Fi-
nancial Institutions Reform, Recovery, and Enforcement 
Act of 1989 (12 U.S.C. 3348(b)) is amended— 
(1) by striking ‘‘and’’ after the semicolon in 
paragraph (3); 
(2) by striking the period at the end of para-
graph (4) and inserting a semicolon; 
(3) by adding at the end the following new para-
graphs: 
‘‘(5) to make grants to State appraiser certifying 
and licensing agencies to support the efforts of such 
agencies to comply with this title, including— 
‘‘(A) the complaint process, complaint in-
vestigations, and appraiser enforcement activi-
ties of such agencies; and 
‘‘(B) the submission of data on State li-
censed and certified appraisers and appraisal 
management companies to the National ap-
praisal registry, including information affirm-
ing that the appraiser or appraisal management 
company meets the required qualification cri-
teria and formal and informal disciplinary ac-
tions; and 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00167
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
169 
(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 fol-
lows: 
‘‘(a) IN GENERAL.—The Appraisal Subcommittee shall 
monitor each State appraiser certifying and licensing agen-
cy for the purposes of determining whether such agency— 
‘‘(1) has policies, practices, funding, staffing, 
and procedures that are consistent with this title; 
‘‘(2) processes complaints and completes inves-
tigations in a reasonable time period; 
‘‘(3) appropriately disciplines sanctioned ap-
praisers and appraisal management companies; 
‘‘(4) maintains an effective regulatory program; 
and 
‘‘(5) reports complaints and disciplinary actions 
on a timely basis to the national registries on ap-
praisers and appraisal management companies main-
tained by the Appraisal Subcommittee. 
The Appraisal Subcommittee shall have the authority to re-
move a State licensed or certified appraiser or a registered 
appraisal management company from a national registry 
on an interim basis pending State agency action on licens-
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00169
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
170 
ing, certification, registration, and disciplinary pro-
ceedings. The Appraisal Subcommittee and all agencies, in-
strumentalities, and Federally recognized entities under 
this title shall not recognize appraiser certifications and li-
censes from States whose appraisal policies, practices, fund-
ing, staffing, or procedures are found to be inconsistent with 
this title. The Appraisal Subcommittee shall have the au-
thority to impose sanctions, as described in this section, 
against a State agency that fails to have an effective ap-
praiser regulatory program. In determining whether such 
a program is effective, the Appraisal Subcommittee shall 
include an analyses of the licensing and certification of ap-
praisers, the registration of appraisal management compa-
nies, the issuance of temporary licenses and certifications 
for appraisers, the receiving and tracking of submitted com-
plaints against appraisers and appraisal management 
companies, the investigation of complaints, and enforce-
ment actions against appraisers and appraisal manage-
ment companies. The Appraisal Subcommittee shall have 
the authority to impose interim actions and suspensions 
against a State agency as an alternative to, or in advance 
of, the derecognition of a State agency.’’. 
(2) in subsection (b)(2), by inserting after ‘‘au-
thority’’ the following: ‘‘or sufficient funding’’. 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00170
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
171 
(l) RECIPROCITY.—Subsection (b) of section 1122 of 
the Financial Institutions Reform, Recovery, and Enforce-
ment Act of 1989 (12 U.S.C. 3351(b)) is amended to read 
as follows: 
‘‘(b) RECIPROCITY.—A State appraiser certifying or 
licensing agency shall issue a reciprocal certification or li-
cense for an individual from another State when— 
‘‘(1) the appraiser licensing and certification 
program of such other State is in compliance with the 
provisions of this title; and 
‘‘(2) the appraiser holds a valid certification 
from a State whose requirements for certification or 
licensing meet or exceed the licensure standards estab-
lished by the State where an individual seeks ap-
praisal licensure.’’. 
(m) CONSIDERATION OF PROFESSIONAL APPRAISAL 
DESIGNATIONS.—Section 1122(d) of the Financial Institu-
tions Reform, Recovery, and Enforcement Act of 1989 (12 
U.S.C. 3351(d)) is amended by striking ‘‘shall not exclude’’ 
and all that follows through the end of the subsection and 
inserting the following: ‘‘may include education achieved, 
experience, sample appraisals, and references from prior 
clients. Membership in a nationally recognized professional 
appraisal organization may be a criteria considered, 
though lack of membership therein shall not be the sole bar 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00171
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
172 
against consideration for an assignment under these cri-
teria.’’. 
(n) APPRAISER INDEPENDENCE.—Section 1122 of the 
Financial Institutions Reform, Recovery, and Enforcement 
Act of 1989 (12 U.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 and licensing agency for the purpose of deter-
mining whether such agency’s policies, practices, and proce-
dures are consistent with the purposes of maintaining ap-
praiser independence and whether such State has adopted 
and maintains effective laws, regulations, and policies 
aimed at maintaining appraiser independence.’’. 
(o) APPRAISER EDUCATION.—Section 1122 of the Fi-
nancial Institutions Reform, Recovery, and Enforcement 
Act of 1989 (12 U.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 Sub-
committee shall encourage the States to accept courses ap-
proved by the Appraiser Qualification Board’s Course Ap-
proval Program.’’. 
(p) APPRAISAL COMPLAINT HOTLINE.—Section 1122 
of the Financial Institutions Reform, Recovery, and En-
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00172
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS
173 
forcement Act of 1989 (12 U.S.C. 3351), as amended by 
this section, is further amended by adding at the end the 
following new subsection: 
‘‘(i) APPRAISAL COMPLAINT NATIONAL HOTLINE.—If, 
1 year 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 influ-
encing of appraisers or the appraisal process, the Appraisal 
Subcommittee shall establish and operate such a national 
hotline, which shall 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 govern-
mental bodies, including a State appraiser certifying and 
licensing agency, a financial institution regulator, or other 
appropriate legal authorities. For complaints referred to 
State appraiser certifying and licensing agencies or to Fed-
eral regulators, the Appraisal Subcommittee shall have the 
authority to follow up such complaint referrals in order to 
determine the status of the resolution of the complaint.’’. 
VerDate Nov 24 2008 
03:43 May 05, 2009
Jkt 079200
PO 00000
Frm 00173
Fmt 6652
Sfmt 6203
E:\BILLS\H1728.RH
H1728
bajohnson on PROD1PC77 with BILLS