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house Bill H.R. 2852

Should Requirements for Appraisers of FHA-Insured Mortgages be Loosened?

Argument in favor

The current requirements for appraisers of Federal Housing Administration-insured mortgages are too onerous. This has resulted in a shortage of appraisers for such homes, which is burdensome for certain types of prospective home buyers (specifically, first-home buyers, low- and moderate-income households, minorities, and those in rural areas).

Frances's Opinion
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09/09/2019
I THOUGHT SO--ANY BILL THAT HELPS THE COMMON MAN IS ALWAYS INTRODUCED BY A DEMOCRAT, BECAUSE THEY GOP CARE ONLY FOR THE RICH AND BIG CORPORATE, WHO PAY THEM!
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J's Opinion
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09/10/2019
Yes! And repeal Dodd Frank while you’re at it so that consumers can actually vet their appraisers and be able to know they are paying for a quality product and not padding the lender! There is NO transparency under Dodd Frank for the consumer! There is currently not nearly as much consumer protection as there used to be before Dodd Frank!
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NoHedges's Opinion
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09/10/2019
While I cannot find much scholarly discourse on this bill, what little I can dig up on the representative proposing this legislation is seeking to represent the voters in his district. Although Mr. Sherman has been in office for more than 20 years, I saw nothing that would signal a significant increase in net worth or anything that would suggest a pattern of placing party before people. Mr. Sherman supports impeachment and has repeatedly voted to increase the Federal minimum wage. But what really cinched my decision to trust, was Representative Sherman vote to Preserve Alaska's ANWR instead of drilling it.
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Argument opposed

Rather than trying to increase the number of FHA appraisers, mortgage issuers and the federal government should think critically about whether and when human appraisers are necessary. Big data and automation could potentially replace the need for human appraisers. Alternatively, the de minimus threshold could be raised to decrease the number of homes that need appraisal.

Jerry's Opinion
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09/10/2019
Yeah, great, the 2008 recession was such a blast let’s do it again.
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John's Opinion
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09/10/2019
The appraisers are already as about as lame as they can be which doesn’t do much to help a homebuyer so why in God’s name make it worse! You want to make better; increase the pay and get better people.
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Edward's Opinion
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09/10/2019
Are e going to have the last recession over again?
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bill Progress


  • Not enacted
    The President has not signed this bill
  • The senate has not voted
      senate Committees
      Committee on Banking, Housing, and Urban Affairs
  • The house Passed September 10th, 2019
    Roll Call Vote 419 Yea / 5 Nay
      house Committees
      Committee on Financial Services
    IntroducedMay 20th, 2019

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What is House Bill H.R. 2852?

This bill — the Homebuyer Assistance Act of 2019 — would address appraisal shortages by modifying the requirements for appraisers of Federal Housing Administration (FHA)-insured mortgages to reduce barriers to becoming an appraiser for FHA-backed mortgages. Currently, an appraiser must be certified by certain state or national entities. This bill removes the national entities from the list of approved certification entities and allows an appraiser to be state-licensed, rather than state-certified, to meet requirements. It also provides specified educational requirements for appraisers.

If enacted, this change would bring the federal standards for FHA appraisers in line with the federal minimum requirements in place for other home mortgages from Fannie Mae and Freddie Mac.

Impact

Homebuyers; home appraisals; home appraisers; appraisers of homes receiving FHA-insured mortgages; and federal standards for appraisers of homes receiving FHA-insured mortgages.

Cost of House Bill H.R. 2852

The CBO estimates that implementing this bill wouldn’t have any meaningful cost, and that any administrative costs associated with implementing the new appraisal standards would total less than $500,000 over the 2020-2024 period.

More Information

In-DepthRep. Brad Sherman (D-CA) introduced this bill to make it easier for homebuyers to buy a home

“The process of purchasing a home is already difficult enough for first-time, low-income, and minority homebuyers, they do not need the added challenge of finding a certified appraiser. This legislation is a common-sense revision to current appraisal requirements, which will make FHA mortgage accessible to more Americans.” Sherman also thanked House Financial Services Committee Chairwoman Maxine Waters for working closely with him on this issue.”

The Credit Union National Association (CUNA) supports this bill. In a letter to the House Financial Services Committee’s Subcommittee on Housing, Community Development and Insurance Chairman Rep. Lacy Clay (D-MO) and Ranking Member Rep. Sean Duffy (R-WI), CUNA argued that more uniformity and consistency in the federal standards governing appraisers would help reduce the costs associated with issuing mortgage loans to credit union members: 

“Appraisals play a critical role in the home purchase process and a credit union’s assessment of the safety and soundness of providing a consumer with a home loan by helping to ensure that a mortgage does not exceed the value of the home that serves as its collateral. Accordingly, greater uniformity and consistency in the federal standards governing appraisers helps to reduce the costs associated with issuing mortgage loans to credit union members. The ‘Homebuyer Assistance Act of 2019,’... is an important effort in this respect. The bill would increase uniformity in the federally-backed mortgage loan market by ensuring that the Federal Housing Administration’s appraiser requirements are identical to those currently employed by Fannie Mae and Freddie Mac concerning licensed appraisers. As a result, credit unions would be able provide members with more choices for federally-backed loans without having to worry that an appraisal will not satisfy a program’s requirements due to their differing appraiser certification standards. If passed, the Homebuyer Assistance Act of 2019 will be a positive change for both consumers and lenders in the mortgage market.” 

This legislation passed the House Financial Services by voice vote with the support of one cosponsor, Rep. Sean Duffy (R-WI). It’s supported by a range of housing and credit associations, including The Center for Responsible Lending, the Appraisal Foundation, the Appraisal Institute, the Real Estate Valuation Advocacy Association, the National Association of Appraisers, the American Society of Appraisers, the MBREA – Association for Valuation Professionals, the National Association of REALTORS®, the National Association of Home Builders, the American Bankers Association, the Mortgage Bankers Association, the Credit Union National Association, the National Association of Federal Credit Unions, the Community Home Lenders Association, and the Independent Community Bankers of America.


Of NoteIn a 2017 survey, nearly 75% of appraisers cited regulatory burdens as a leading reason for leaving the field. The lack of appraisers for FHA-insured mortgages disproportionately affects first-time homebuyers, low- and moderate-income households, and minorities, as they’re more likely to obtain FHA mortgages (in 2018, over 85% of FHA mortgages were made to first-time homebuyers and over 33% of FHA loans were made to minority households). Rep. Sean Duffy (R-WI) notes that the lack of professional appraisers qualified to inspect FHA-insured homes is particularly acute in rural areas.

Working RE editor Isaac Peck observes that many appraisers feel positively about the shortage of people in their profession, as the lack of competition has driven fees up in many areas. However, Peck also adds that the overall decline in the number of appraisers “threatens the integrity of lending and undermines the stability of the real estate market” and doesn’t bode well for the appraisal profession with the advent of big data and automated systems, which could eventually replace human appraisers.

As an alternative to trying to boost the number of qualified appraisers, some in the mortgage industry, led by the American Banker’s Association (ABA), argue that it’s time to raise the federal de minimus (the threshold below which an appraisal isn’t required for a federally-related transaction) from its current $250,000 to $500,000. As part of this argument, the ABA and a coalition of smaller regional banks argue that appraisals are unnecessary costs that make it hard for small banks to compete.


Media:

Summary by Lorelei Yang

(Photo Credit: iStockphoto.com / CatLane)

AKA

Homebuyer Assistance Act of 2019

Official Title

To amend the National Housing Act to authorize State-licensed appraisers to conduct appraisals in connection with mortgages insured by the FHA and to require compliance with the existing appraiser education requirement, and for other purposes.

    I THOUGHT SO--ANY BILL THAT HELPS THE COMMON MAN IS ALWAYS INTRODUCED BY A DEMOCRAT, BECAUSE THEY GOP CARE ONLY FOR THE RICH AND BIG CORPORATE, WHO PAY THEM!
    Like (13)
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    Yeah, great, the 2008 recession was such a blast let’s do it again.
    Like (36)
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    The appraisers are already as about as lame as they can be which doesn’t do much to help a homebuyer so why in God’s name make it worse! You want to make better; increase the pay and get better people.
    Like (20)
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    Are e going to have the last recession over again?
    Like (16)
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    People need to relax. This isn't loosening regulations on buying homes, it's allowing more appraisers the ability to perform FHA work. There are three levels of appraisal licensing, and so far only levels 2 and 3 (I happen to be a level 2) have been able to perform FHA appraisals, but level 1 receives all the same necessary training and education to be able to perform them. There really wasn't any good reason for them to be excluded in the first place. I don't like having all the extra competition..but hey...capitalism...right? ;)
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    I am in favor of creating every opportunity to help people become homeowners. I don’t want to see reckless lending like we saw leading up to the Great Recession... I don’t know enough about this bill to favor it or oppose it. Please help people become homeowners when possible. But it must be done without reckless lending that sets up people for disaster when recession hits. Use caution and prudent regulations.
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    An ever growing list of trumps accomplishments and of those in congress who support him: Most recent: Took money from military daycares to pay for a wall that won’t work and no one wants. The Vice President and the Attorney General are both spending tax payer dollars on trump hotels, lining his pockets and currying his favor. Privately instructed aides to skirt laws and regulations to get the wall built faster — and told them he will pardon them if necessary. Pressuring a government agency to give a contract for his wall to a company whose chief executive is a donor to one of his top GOP allies in Congress. Took hundreds of millions from 127 different projects (FEMA being one of those) for his wall. Spending our tax dollars at his golf courses. Thinks nuking a hurricane is an idea. Pushing to host the next G-7 at one of his own resorts. Taunted Iran by tweeting a classified image of an Iranian rocket that had exploded, thereby potentially compromising U.S. intelligence capabilities. His own company would save millions from the low interest rates he is demanding. Was going to give you tax cuts through your paychecks but decided not to. Destroying the economy with HIS trade war. We will soon average a 1.2 trillion deficit. He is repeating NRA talking points on background checks so expect no action taken regardless of the fact there has been 27 arrested over threats to commit mass attacks since El Paso( NOT TOLEDO). Made fun of republicans being afraid of the NRA and then caved after a 30 minute phone conversation with them. Bragged about indefinite child detention because it brings families together. Refusing flue shots, that protect us all(google influenza pandemic), to immigrant children. Attacking fellow congresswomen in really disgusting ways and making anti-Semitic remarks about Jews calling them disloyal. Thinks he’s the chosen one based on a conspiracy theory web sight. Impeachment: Obstruction of Justice. Profiting from the Presidency. Collusion - They had a meeting & lied about it. Advocating political & police violence. Abuse of power. Engaging in reckless behavior. Persecuting political opponents. Attacking the free press. Violating immigrants Right to Due Process. Violating campaign finance laws. Racist: Speaks directly to and often tweeting straight from white supremacists. Calls them very fine people. Told fellow congresswomen to go back where they came from. Called them shit hole countries. Called them murderers and rapists. Calls her Pocahontas. Took out full page adds calling for the death of five innocent black kids in New York, 1989. Literally has said in an interview he has Hitlers speeches, My New Order in his nightstand. Our Money: Spent campaign finance money on hush payments to silence a porn star he had an affair with in order to hide it from the voters. Has spent over $100 million of our tax dollars playing golf at his own golf courses. Has never divested from companies and advertises and profits off the White House. Was going to cut Medicaid and Medicare funding to pay for the tax cuts he gave to the rich. Is actively destroying farmers lives with his trade wars that we all know only hurts our pockets not Chinas. Has made the lives of every truck driver across America as well as our own, more dangerous by removing safety regulations that only benefits the pockets of the CEOs of those companies. Has removed any and all protections we had in place from work safety, environment, women’s rights, LGBTQ rights and gives that power back to the CEOs, oil companies, men and old white men. Saudi funded lobbyist rented 500 rooms at a trump hotel he never divested from right after he became president. Wonder why? Sexual Predator: Accused by more than 20 women of molestation and rape. Bragged about said molestation on tape. Has cheated on all three wives (see above). Has made sexual remarks on camera about his daughter. Belittles and bully’s strong women. Not even sure he’s aware he has two daughters. Idiot: Has allowed North Korea to grow there nuclear weapons program. Took the side of Putin over America’s own security agencies on the national stage. Lacks the intelligence and facts needed to communicate on a global level much less national one. Makes policy decisions based on FOX media. Lies when speaks. Doesn’t believe in science and quite often displays his ignorance of it. Russia: Lied about meetings with Russians. Lied about a trump tower Moscow. Personal attorney Michael Cohen (same guy who broke campaign finance laws under trumps direction) had contacts with russian officials. National Security aide Flynn resigned over Russian contacts. Jeff Sessions recused himself because of Russian contacts. Manafort resigned because of Russian contacts. Campaign foreign policy adviser Papadopoulos met with Russians then bragged about it to Australians who then turned that info over to our FBI. Sixteen campaign officials had contacts with Russia and at least nine others new about it. Russian mobster lived in trump tower. trump casino was flagged 106 times for lax money laundering standards and same Russian frequently stayed at trump casino. Has been selling real estate to Russians for years. It really is surprising how many connections to Russians this man has. Rick Scott, Marco Rubio, Bill Posey You are my representatives. OLC policy: The indictment or criminal prosecution of a sitting President would unconstitutionally undermine the capacity of the executive branch to perform its constitutionally assigned functions. It’s time to do your job. You swore an oath to this country, it’s people and me to uphold the constitution. The president has never upheld that oath. How do you want to be remembered?
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    Loosing the requirements for buying homes, while well-intended, is only going to destabilize the housing market even further! The last time we loosened these kinds of requirements, we had a financial crash and the Great Recession! Why don’t we focus on building more affordable homes?!
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    Another ploy to stick it to the public.
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    Appraisals should be reliable and in line with current mortgage lending requirements. One of the large systemic problems leading to the Great Recession was that some houses were over-appraised and then big mortgages were obtained for people who couldn't pay for them. We have to prevent that happening again.
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    While I cannot find much scholarly discourse on this bill, what little I can dig up on the representative proposing this legislation is seeking to represent the voters in his district. Although Mr. Sherman has been in office for more than 20 years, I saw nothing that would signal a significant increase in net worth or anything that would suggest a pattern of placing party before people. Mr. Sherman supports impeachment and has repeatedly voted to increase the Federal minimum wage. But what really cinched my decision to trust, was Representative Sherman vote to Preserve Alaska's ANWR instead of drilling it.
    Like (7)
    Follow
    Share
    Yes! And repeal Dodd Frank while you’re at it so that consumers can actually vet their appraisers and be able to know they are paying for a quality product and not padding the lender! There is NO transparency under Dodd Frank for the consumer! There is currently not nearly as much consumer protection as there used to be before Dodd Frank!
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    Impeach Trump!!!
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    This isn’t changing FHA requirements just giving appraisals more latitude
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    Help people become homeowners.
    Like (4)
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    Oh a ridiculous idea... lower the standards? Really? Gee, why not drop all standards and we can have all the desks occupied?! Who’s critical thinking skills failed to engage with this proposal? If we have fewer qualified people supervising loans, we could actually have more mortgage defaults because of a greater number of unqualified able to repay loans. Anyone thought of that potential .., talk to some banks that failed during the banking crisis.
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    Does anyone remember the resolution trust and why it was formed to begin with.
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    No way. Don’t you remember the mortgage implosion?!?
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    Reduce red tape
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    If you do not learn when making errors you will make them over and over again. History repeating itself and some just never learn. WIN Win winning 2020
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