Appraisal Independence (TILA § 129E)

15 U.S.C. § 1639e

Added to the Truth in Lending Act as section 129E by section 1472 of the Dodd-Frank Act, this statute makes it unlawful to compensate, coerce, extort, collude with, instruct, induce, bribe, or intimidate an appraiser for the purpose of causing the appraised value of a consumer's principal dwelling to be based on anything other than the appraiser's independent judgment in a covered consumer credit transaction. It bars any appraiser conducting, and any appraisal management company procuring or facilitating, an appraisal from having a direct or indirect financial or other interest in the property or transaction (subsection (d)); requires parties to refer appraisers to state licensing agencies when there is a reasonable basis to believe they are violating USPAP, applicable law, or ethical standards (subsection (e)); and requires lenders and their agents to compensate fee appraisers at rates that are customary and reasonable for the geographic market area (subsection (i)). The Federal Reserve Board's implementing interim final rule (Regulation Z, 12 CFR 226.42) became mandatory April 1, 2011; rulemaking and enforcement authority for TILA later transferred to the CFPB.