Compliance Q&A: Reg B Copies of Appraisals/Valuations
Use the proper language for notices of the right to receive copies.
Q: What disclosure language should we use for the notice of the right to receive copies of appraisals/valuations under the amended Regulation B?
A: Regulation B (Equal Credit Opportunity) provides the following language in Form C-9 (Sample Disclosure of Right to Receive a Copy of Appraisals):
We may order an appraisal to determine the property’s value and charge you for this appraisal. We will promptly give you a copy of any appraisal, even if your loan does not close. You can pay for an additional appraisal for your own use at your own cost.
The rule—effective on Jan. 18, 2014—covers applications for closed-end or open-end credit secured by a first lien on a dwelling.
Q: Regulation Z (Truth in Lending) also requires creditors to provide free copies of appraisals for higher-priced mortgage transactions and to provide a disclosure at application. Can we use the Reg B appraisal notice to satisfy this requirement?
A: The Reg B appraisal requirements overlap with the rule on appraisals for higher-priced mortgages under Reg Z. The same appraisal notice can be used to satisfy both Reg B and the Truth in Lending rule, in transactions where both rules apply. The Reg Z changes also become effective on Jan. 18, 2014.