§ 5-20.7-24 — § 5-20.7-24. Mortgage loan appraisers — Relationship with lending institution.

§ 5-20.7-24. Mortgage loan appraisers — Relationship with lending institution.

(a) Every bank, trust company, loan-investment company, mortgage company, and credit union or any other lending institution, that accepts an application for any residential mortgage loan or any commercial mortgage loan that requires an appraisal in order to process the loan is not permitted to use an appraisal company that is either owned by or has directors, stockholders, or employees of that bank, trust company, loan-investment company, mortgage company, and credit union or any other lending institution.

(b) All appraisal companies doing business in the state are required to disclose with the Rhode Island department of business regulation those lending institutions that may have an ownership interest in the appraisal company. If an ownership relationship exists between the lending institution and an appraisal company, then the appraisal company is prohibited from conducting any appraisals for that lending institution.

(c) Any appraisal companies doing business within the state shall comply with the provisions of this chapter, title XI of the Federal Financial Institutions Reform, Recovery and Enforcement Act of 1989, 12 U.S.C. § 3331 et seq., as may be amended from time to time, and with the federal and state regulatory standards promulgated thereunder.

(d) Any lending institution that maintains Federal Deposit Insurance Corporation (FDIC) or National Credit Union Association (NCUA) insurance protection for its deposits at a lending institution is exempt from this provision.

(e) A violation of this section shall also be considered to be a violation of chapter 13.1 of title 6.

Legislative History

P.L. 1992, ch. 211, § 1; P.L. 2014, ch. 92, § 2; P.L. 2014, ch. 93, § 2.