Last Updated:
March 10, 2010
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Regulation of Appraisal Management Companies
In compliance with federal law, Colorado currently requires the licensing of real estate appraisers. In order to promote enhanced consumer protection, recently adopted federal guidelines now require mortgage lenders to use entities known as appraisal management companies (AMCs), which hire licensed real estate appraisers, to value property for lending purposes. AMCs are not currently subject to regulation under Colorado law.
SB 077, by Sen. Rollie Heath (D-Boulder) and Rep. Mark Ferrandino (D-Denver) authorizes the Board of Real Estate Appraisers within the Division of Real Estate to regulate AMCs, including those that are bank owned. Among other things, the bill details prohibited acts for AMCs and gives the division the authority to investigate registrants and take disciplinary actions, including imposing fines.
CAR supports the legislation as it is a prudent and much-needed step to ensure increased certainty in the home-buying process. Although the federal HVCC regulations are a much larger problem with regard to appraisals, SB 077 addresses an immediate need in our state. The bill is expected for its first hearing on February 16th in the Senate Business, Labor and Technology Committee.