Temporary deferrals on real estate-related appraisals and evaluations under federal banking agencies’ interagency appraisal regulations were issued late Tuesday for up to 120 days.
The National Credit Union Administration (NCUA) Board is considering a similar action at its next board meeting, scheduled for Thursday.
In a release, the banking agencies (the Federal Deposit Insurance Corp., the Federal Reserve, and the Office of the Comptroller of the Currency [OCC]), said they were providing the relief to allow regulated banks, thrifts, and other firms to extend financing to creditworthy households and businesses “quickly” in the face of the coronavirus crisis.
The rule will take effect upon publication in the Federal Register (not yet scheduled).
The agencies said they were deferring certain appraisals and evaluations for up to 120 days after closing of residential or commercial real estate loan transactions. “Transactions involving acquisition, development, and construction of real estate are excluded from this interim rule,” they said.
These deferral provisions will expire on Dec. 31, 2020, unless extended by the federal banking agencies, they said in the release.
Meanwhile, the banking agencies – along with the NCUA and the Consumer Financial Protection Bureau (CFPB), in consultation with state supervisory authorities – said they were issuing a joint statement outlining “other flexibilities” intended to address appraisal and evaluation challenges in real estate transactions affected by the crisis.
The agencies said the statement describes temporary changes in Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Mortgage Corp. (Freddie Mac) appraisal standards. The agencies said the changes “can assist lenders during this challenging time.”