N.Y. Executive Law § 160-oooo: Unprofessional conduct

§ 160-oooo. Unprofessional conduct. 1. Appraisal management companies

shall not engage in unprofessional conduct including, but not limited to

the following:

(a) Requiring an appraiser to modify any aspect of an appraisal report

or valuation service report, unless such modifications are appropriate

according to USPAP;

(b) Requiring an appraiser to prepare an appraisal report or valuation

service report if such appraiser, in their professional judgment,

believes they don't have the necessary expertise for the specific

geographic and or specific area type;

(c) Requiring an appraiser to prepare an appraisal report or valuation

service under a time frame that such appraiser believes, in their

professional judgment, does not afford such appraiser the ability to

meet all the relevant legal and professional obligations including USPAP

requirements. Notwithstanding the foregoing provisions of this

paragraph, all appraisal reports should be completed within a reasonable

timeframe and appraisers may not unnecessarily delay completing

appraisal assignments;

(d) Prohibiting or inhibiting communication between the appraiser and

the lender, a real estate licensee, or any other person from whom such

appraiser, in their professional judgment is relevant;

(e) Requiring the appraiser to do anything that does not comply with

USPAP, or any assignment conditions and certifications required by the

client;

(f) Making any portion of the appraiser's fee or the appraisal

management company's fee contingent upon a favorable outcome, including,

but not limited to, the closing of a loan, requiring a specific dollar

amount be achieved by such appraiser in the appraisal report, making

requests for the purpose of facilitating a mortgage loan transaction,

setting a broker price opinion, or setting any other real property price

or value estimation that does not qualify as an appraisal; or

(g) Each appraisal management company operating in this state shall

make payment to an appraiser for the completion of an appraisal or

valuation assignment within thirty days of the date on which such

appraiser transmits or otherwise provides the completed appraisal or

valuation services to the appraisal management company or its assignee;

2. It shall be unlawful for an appraisal management company to:

(a) Knowingly fail to compensate an appraiser at a rate that is

reasonable and customary for appraisal or other valuation services being

performed in the market area of the property being appraised without the

services of an appraisal management company in a manner that is either

inconsistent with, or would violate section 1639(e) of the federal Truth

in Lending Act (15 USC §1639(e));

(b) Knowingly include any fees for appraisal management services that

are performed by the appraisal management company for a lender, client,

or other person in the amount that it charges the lender, client, or

other person for the actual completion of an appraisal or valuation

service by an appraiser that is part of the appraiser panel of the

appraisal management company;

(c) Knowingly fail to separate any and all fees charged to a client by

the appraisal management company for the actual completion of an

appraisal by an appraiser from the fees charged to a lender, client, or

any other person by an appraisal management company for appraisal

management services;

(d) Knowingly prohibit an appraiser from recording the fee that such

appraiser was paid by the appraisal management company for the

performance of the appraisal within the appraisal report that is

submitted by such appraiser to the appraisal management company;

(e) Knowingly fail to separately state the fees paid to an appraiser

for appraisal services and the fees charged by the appraisal management

company for services associated with the management of the appraisal

process to the client, borrower and any other payer. Appraisal

management companies shall provide a copy of the appraiser's invoice

with a copy of any appraisal report submitted to a client or a client's

representative;

(f) Knowingly allow the removal from rotation of an appraiser from an

appraiser panel, without prior written notice to such appraiser with

just cause; or

(g) Knowingly obtain, use, or pay for a second or subsequent appraisal

or the ordering of an automated valuation model or any other valuation

service in connection with a mortgage financing transaction unless there

is a reasonable basis to believe that the initial appraisal was flawed

or tainted and such basis is clearly and appropriately noted in the loan

file, or unless such appraisal or automated valuation model is done

pursuant to a bona fide pre- or post-funding appraisal review or quality

control process. Nothing in this paragraph shall prohibit an AMC from

obtaining additional appraisals if required by a lending program, or if

such additional appraisals are required by applicable local, state, or

federal law.