DAR File No. 41024
This rule was published in the December 15, 2016, issue (Vol. 2016, No. 24) of the Utah State Bulletin.
Commerce, Real Estate
Appraisal Management Company Administrative Rules
Notice of Proposed Rule
DAR File No.: 41024
Filed: 11/17/2016 01:09:28 PM
Purpose of the rule or reason for the change:
The purposes of the proposed amendment are to: 1) provide clarity and transparency in communications between an Appraisal Management Company (AMC) and an appraiser with regard to disclosures and notices from an AMC to an appraiser; 2) provide a presumption of compliance for an AMC that its appraisal fees are customary and reasonable if the AMC pays an appraiser consistent with the United States Department of Veterans Affairs fee schedule; 3) clarify the manner in which an AMC may offer an appraisal assignment to an appraiser; and 4) specify that if an AMC uses delivery time for completion of an appraisal report for a tiered panel model or when ranking an appraiser, the AMC shall only use business days in the time calculation.
Summary of the rule or change:
In Subsection R162-2e-102(3), amends the definition of business day. In Section R162-2e-304, the amendment: 1) changes and adds to the disclosures an AMC is required to disclose to an appraiser; 2) changes and adds to the notices an AMC is required to provide an appraiser; and 3) provides a presumption of compliance for an AMC that pays an appraiser compensation consistent with the United States Department of Veterans Affairs fee schedule. In Section R162-2e-306, the amendment: 1) specifies the manner in which an AMC may offer an appraisal assignment to an appraiser; and 2) specifies that if an AMC uses delivery time for completion of an appraisal report when ranking an appraiser, the AMC shall only use business days in the time calculation.
Statutory or constitutional authorization for this rule:
- Section 61-2e-103
- Section 61-2e-301
- Section 61-2e-304
- Section 61-2e-306
Anticipated cost or savings to:
the state budget:
The division has the staff and budget in place to administer this proposed amendment. It is not expected that the proposed amendment will affect those resources or result in any additional cost or savings to the state budget.
Local governments are not required to comply with or enforce the Appraisal Management Company Administrative Rules. No fiscal impact to local government is expected from the proposed amendment.
The proposed amendment does not create new obligations for small businesses nor does it increase the cost associated with any existing obligation. No fiscal impact to small business is expected from the proposed amendment.
persons other than small businesses, businesses, or local governmental entities:
The proposed amendment does not create new obligations for persons other than small businesses, businesses, or local government entities nor does it increase the cost associated with any existing obligation. No fiscal impact to persons other than small businesses, businesses, or local government entities is expected from the proposed amendment.
Compliance costs for affected persons:
The proposed rule does create new obligations and sets new limitations for AMCs subject to the administrative rules. Some AMCs will likely incur compliance costs but these costs will vary among the AMCs and there is no way to determine the amount of these costs.
Comments by the department head on the fiscal impact the rule may have on businesses:
A minor amendment is made to the definition of "business day" in Section R162-2e-102. The amendment to Section R162-2e-304 changes and adds to the disclosures an appraisal management company (AMC) makes to an appraiser and provides a presumption of payment of an appraiser at a customary and reasonable rate, if the compensation is consistent with the fee schedule published by the United States Department of Veterans Affairs Denver Regional Loan Center. Section R162-2e-306 is a new section that specifies the manner in which an AMC may offer an appraisal assignment to an appraiser and the manner in which the time of completion of an appraisal report is to be computed. The changed Section R162-2e-304 and the new section do create new obligations for AMCs, resulting in some additional costs of implementation. However, these changes are minor, and there is no way to determine with precision the amount of these costs. The fiscal impact to businesses is negligible.
Francine A. Giani, Executive Director, Commerce
The full text of this rule may be inspected, during regular business hours, at the Office of Administrative Rules, or at:Commerce
HEBER M WELLS BLDG
160 E 300 S
SALT LAKE CITY, UT 84111-2316
Direct questions regarding this rule to:
- Justin Barney at the above address, by phone at 801-530-6603, by FAX at , or by Internet E-mail at firstname.lastname@example.org
Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:
This rule may become effective on:
Jonathan Stewart, Director
R162. Commerce, Real Estate.
R162-2e. Appraisal Management Company Administrative Rules.
(1) "Affiliation" means a business association:
(i) two individuals registered, licensed, or certified under Section 61-2b; or
(ii) an individual registered, licensed, or certified under Section 61-2b and:
(A) an appraisal entity; or
(B) a government agency;
(b) for the purpose of providing an appraisal service; and
(c) regardless of whether an employment relationship exists between the parties.
(2) The acronym "AMC" stands for appraisal management company.
As used in Subsection R162-2e-201(3)(c)(ii),
[ business] day" means a day other than:
(a) a Saturday;
(b) a Sunday;
(c) a state or federal holiday[
; or (d) any other day when the division is closed for
(4) "Client" is defined in Section 61-2e-102(10).
(5) "Competency statement" means a statement provided by the AMC to the appraiser that, at a minimum, requires the appraiser to attest that the appraiser:
(a) is competent according to USPAP standards;
(b) recognizes and agrees to comply with:
(i) laws and regulations that apply to the appraiser and to the assignment;
(ii) assignment conditions; and
(iii) the scope of work outlined by the client; and
(c) has access, either independently or through an affiliation pursuant to Subsection (1), to the records necessary to complete a credible appraisal, including:
(i) multiple listing service data; and
(ii) county records.
(6)(a) "Employee" means an individual:
(i) whose manner and means of work performance are subject to the right of control of, or are controlled by, another person; and
(ii) whose compensation for federal income tax purposes is reported, or is required to be reported, on a W-2 form issued by the controlling person.
(b) "Employee" does not include an independent contractor who performs duties other than at the discretion of, and subject to the supervision and instruction of, another person.
(c) For purposes of applying Subsection R162-2e-401(1)(g), an appraiser who completes an assignment is considered to be an employee of the AMC that offers the assignment if:
(i) this subsection (a) describes the employment relationship between the appraiser and the AMC; or
(ii) pursuant to this subsection (a), the appraiser is an employee of a company:
(A) that is wholly owned by the AMC; or
(B) in which the AMC owns a controlling interest.
(7) "Select" means:
(a) for purposes of composing the AMC appraiser panel, to review and evaluate the qualifications of an appraiser who applies to be included on the AMC's appraiser panel; and
(b) for purposes of assigning an appraisal activity to an appraiser:
(i) to choose from the AMC's appraiser panel an individual appraiser or appraisal entity to complete an assignment; or
(ii) to compile, from among the appraisers included in the AMC's appraiser panel, an electronic distribution list of appraisers to whom an assignment will be offered through e-mail.
(8) The acronym "USPAP" stands for Uniform Standards of Professional Appraisal Practice.
R162-2e-304. Required Disclosure .
In addition to the disclosures required by Section 61-2e-304, an AMC shall:
(1)] at the time an assignment is offered,
disclose to the appraiser:
(a)] the total amount that the appraiser may
expect to earn from the assignment:
(i)] disclosed as a dollar amount; and
(ii)] delineating any fees or costs that will be
charged by the AMC to the appraiser;
(b)(i)] the property address;
(ii)] the legal description; or
(iii)] equivalent information that would allow the
appraiser to determine whether the appraiser has been involved with
any service regarding the subject property within the three years
preceding the date on which the assignment is offered;
(c)] the assignment conditions and scope of work
requirements in sufficient detail to allow the appraiser to
determine whether the appraiser is competent to complete the
(d)] any known deadlines within which the
assignment must be completed;
(2)] at or before the time the appraiser accepts
an assignment, obtain the appraiser's acknowledgment as to the
AMC's competency statement;
(3) before requiring the appraiser to submit a completed
report, disclose to the appraiser: (a) the total fee that will be collected by the AMC for
the assignment; and (b) the total amount that the AMC will retain from the fee
charged, disclosed as a dollar amount; and]
(4)] direct the appraiser who performs the real
estate appraisal activity to disclose in the body of the appraisal
(a)] the total compensation, stated as a dollar
amount, paid to the appraiser or, if the appraiser is employed by
an appraisal company, to the appraiser's employer; and
(b)] the total compensation retained by the AMC in
connection with the real estate appraisal activity, stated as a
KEY: administrative proceedings, appraisal management company, conduct, registration
Date of Enactment or Last Substantive Amendment: [
January 28, 2015]
Notice of Continuation: April 17, 2015
Authorizing, and Implemented or Interpreted Law: 61-2e-102(4); 61-2e-103; 61-2e-307; 61-2e-305; 61-2e-402(1)
More information about a Notice of Proposed Rule is available online.
The Portable Document Format (PDF) version of the Bulletin is the official version. The PDF version of this issue is available at https://rules.utah.gov/publicat/bull-pdf/2016/b20161215.pdf. The HTML edition of the Bulletin is a convenience copy. Any discrepancy between the PDF version and HTML version is resolved in favor of the PDF version.
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For questions regarding the content or application of this rule, please contact Justin Barney at the above address, by phone at 801-530-6603, by FAX at , or by Internet E-mail at email@example.com. For questions about the rulemaking process, please contact the Office of Administrative Rules.