AI, ASA oppose Veterans' Appraiser Choice Act. (Industry and Institute News).

The Appraisal Institute and American Society of Appraisers have asked bill sponsor Adam Smith, D-Wash, to withdraw H.R. 1500, The Veterans' Appraiser Choice Act, in an April 24 letter, citing concerns of lack of objectivity, the potential for pressure and consumer protection.

"The independence of the appraisal process is a fundamental principle that assures participants in a mortgage transaction that the value of a home held as collateral will reflect the market value. This protects both the lender and the buyer," the letter stated, It went on to reference the current Loan Guaranty program administered by the Department of Veterans Affairs, through which real estate appraisers are selected by rotation from the VA Fee Panel, the "approved" appraiser list administered by VA. "The key benefit of selecting appraisers by rotation and away from lenders, brokers, realty agents or prospective borrowers is to ensure the independence of the appraiser, whose primary responsibility is to provide the VA with an unbiased opinion of value on the property being financed," the two groups stated.

Members of both the Al and the ASA have found that the VA Fee Panel is more effective in reducing instances of inappropriate client pressure than other federal housing programs such as the FHA Single Family Housing loan program, which allows the lender to choose the appraiser. The groups pointed out that recently, the FHA Single Family program has recognized that inappropriate pressure should be avoided and has issued a proposed regulation to hold lenders accountable for the appraisals they order.

For a full copy of the letter, visit www.appraisalinstitute.org/govtaffairs/downloads/ltrs_tstmny/Al-ASA_H R_1500_Ltr.pdf.