Washington State House of Representatives Office of Program Research | BILL ANALYSIS |
Business & Financial Services Committee |
HB 1012
This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent. |
Brief Description: Increasing the penal sum of a surety bond required to be maintained by an appraisal management company.
Sponsors: Representatives Stanford, Kirby, Ryu and Hudgins.
Brief Summary of Bill |
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Hearing Date: 1/17/13
Staff: Alexa Silver (786-7190).
Background:
An appraisal management company is a business entity that administers a panel of appraisers to complete real estate appraisal assignments on behalf of other entities. An appraisal management company's functions include: recruiting appraisers, negotiating fees, and administering appraisal orders. It is unlawful to engage in business as an appraisal management company or to perform appraisal management services without obtaining a license from the Department of Licensing.
Appraisal management services include the following functions performed on behalf of a lender, financial institution, mortgage broker, loan originator, or any other person:
administering an appraiser panel;
recruiting, qualifying, verifying licensing or certification, and negotiating fees and service level expectations with persons who are part of an appraiser panel;
receiving an order for an appraisal from one person or entity and delivering the order to an appraiser for completion;
tracking and determining the status of appraisal orders;
conducting quality control of a completed appraisal prior to delivery of the appraisal; and
providing a completed appraisal to one or more persons or entities.
An application for licensure must include certain information about the entity and controlling persons, as well as certifications that the entity: has a system for verification of appraisal panel members' licensure or certification; has a system to review the work of appraisers who perform real estate appraisal services; maintains a detailed record of each service request; and maintains a complete copy of appraisal reports.
An applicant for licensure must maintain a $25,000 surety bond for the use and benefit of the state and any person with a cause of action against the licensee. The bond must be conditioned that the licensee will abide by the applicable licensing laws and rules.
Summary of Bill:
An applicant for licensure as an appraisal management company must file and maintain a surety bond of at least $100,000.
Appropriation: None.
Fiscal Note: Not requested.
Effective Date: The bill takes effect 90 days after adjournment of the session in which the bill is passed.