Best Practices for an Appraisal Review Operation

From time to time, regulators may conduct an examination of a financial institution’s appraisal review program for a snapshot of the safety and soundness of the lender’s real property valuation program. Examiners may ask for documentation of written policies and procedures, job descriptions and experience of those reviewing appraisals, and evidence of a training program.  Additionally, examiners may audit a sample of completed reviews and all corresponding documentation including all communications to the appraiser, the review documents and work file, proof of resolution of any identified deficiencies, and evidence of a completed appraisal review. A major component of managing valuation risk is ordering the proper valuation product commensurate with the complexity and risk of the property and the loan transaction. Remaining in compliance with the current regulatory environment is challenging. 

This course is intended to assist lenders in understanding the regulatory landscape of appraisal review and in selecting the proper valuation product based on overall risk. After completing this course, lenders will be better equipped to achieve the right balance between economy, efficiency, and valuation risk by identifying weaknesses in their current appraisal review operation (outsourced or in-house) and be introduced to potential solutions for achieving an effective review process