Texas Administrative Code › Title 7 - BANKING AND SECURITIES › Part 6 - CREDIT UNION DEPARTMENT › Chapter 91 - CHARTERING, OPERATIONS, MERGERS, LIQUIDATIONS › Subchapter G - LENDING POWERS › Section 91.708 - Real Estate Appraisals or Evaluations

Current through Reg. 49, No. 28; July 12, 2024
(a) Policies and Procedures. A credit union's
				  board of directors is responsible for reviewing and adopting policies and
				  procedures that establish and maintain an effective, independent real estate
				  appraisal and evaluation program. A credit union's selection criteria for
				  individuals who may perform appraisals or evaluations must provide for the
				  independence of the individual performing the evaluation. That is, the
				  individual has neither a direct nor indirect interest, financial or otherwise,
				  in the property or transaction. The individual selected must also be competent
				  to perform the assignment based upon the individual's qualifications,
				  experience, and educational background. An individual may be an employee of a
				  credit union if the individual qualifies under the conditions and requirements
				  contained in Part 722 of the National Credit Union Administration Rules and
				  Regulations.
(b) Loans Over
				  $400,000. For real estate loans in which the loan amount or extension of credit
				  exceeds $400,000, the credit union shall obtain a professional appraisal report
				  by a state certified or licensed appraiser. The appraisal report shall be in
				  writing and conform to generally accepted appraisal standards as evidenced by
				  the Uniform Standards of Professional Appraisal Practice promulgated by the
				  Appraisal Standards Board of the Appraisal Foundation, in Washington,
				  D.C.
(c) Loans $400,000 or Less.
				  For real estate loans with a loan amount or extension of credit of $400,000 or
				  less, the services of a state certified or licensed appraiser is not necessary;
				  however, the credit union must obtain an appropriate evaluation of real
				  property collateral that is supported by a written estimate of market value
				  either performed by a qualified individual who has demonstrated competency in
				  performing evaluations or from tax appraisal data of a governmental
				  entity.
(d) Right to Require an
				  Appraisal. The commissioner may require an appraisal under this section, at the
				  expense of the credit union, when the commissioner has reasonable cause to
				  believe the value of the collateral is overstated.
(e) Existing Loans. In the case of renewal of
				  a loan where there has been no obvious and material change in market conditions
				  or physical aspects of the property that threatens the adequacy of the credit
				  union's real estate collateral protection after the transaction, even with the
				  advancement of additional funds, a written certification of current value by
				  the original appraiser or an acceptable substitute shall satisfy this
				  section.
(f) Other Appraisal
				  Requirements. A credit union shall also comply with applicable real estate
				  appraisal requirements contained within Part 722 of the National Credit Union
				  Administration Rules and Regulations.