Bill Text: CA SB1000 | 2009-2010 | Regular Session | Amended
Bill Title: Mortgages and deeds of trust: portable appraisals.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2010-05-05 - Set, second hearing. Hearing canceled at the request of author. [SB1000 Detail]
Download: California-2009-SB1000-Amended.html
BILL NUMBER: SB 1000 AMENDED
BILL TEXT
AMENDED IN SENATE APRIL 27, 2010
AMENDED IN SENATE APRIL 8, 2010
INTRODUCED BY Senator Correa
FEBRUARY 9, 2010
An act to add Section 2951 to the Civil Code, relating to mortgage
appraisals.
LEGISLATIVE COUNSEL'S DIGEST
SB 1000, as amended, Correa. Mortgages and deeds of trust:
portable appraisals.
Existing law governs mortgages and deeds of trust on real
property.
This bill would provide that, except as otherwise provided by
federal law, if a person has applied to a lender for a loan secured
by a mortgage or deed of trust on owner-occupied residential real
property and an appraisal has been completed for that lender, in
connection with the loan application, that person may instruct the
lender to provide a copy of the he or she provides to
that lender a copy of a previously completed appraisal
to a second or subsequent lender if of the same
residential real property that is the subject of the loan application
and that appraisal meets specified criteria, and
that appraisal shall be accepted by that second or
subsequent lender for purposes of determining whether to
approve the loan application. This provision would also prohibit the
lender from requiring the loan applicant to obtain a new appraisal of
the property as a condition of approval of the loan. These
requirements would not apply under a specified circumstance.
This bill would also provide that a second or
subsequent lender may not request that an appraiser change the name
of a client within an appraisal report, except as specified.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 2951 is added to the Civil Code, to read:
2951. (a) Except as otherwise provided by federal law, if a
person has applied to a lender for a loan secured by a mortgage or
deed of trust on owner-occupied residential real property in this
state, and he or she provides to that lender a copy of a
previously completed appraisal of the property that meets the
requirements set forth in subdivision (b), both of the following
shall apply: an appraisal has been completed for that
lender on that property in connection with the person's loan
application, the person may instruct that lender to provide a copy of
the previously completed appraisal to a second or
subsequent lender. Both of the following shall apply, upon receipt of
a previously completed appraisal by a second or subsequent lender:
(1) The previously completed appraisal shall be
accepted by that second or subsequent lender for purposes
of determining whether to approve the loan
person's application for a mortgage or deed of trust on
the property that is the subject of the appraisal .
(2) The second or subsequent lender may not require the
applicant to obtain person to purchase
a new appraisal of the residential real same
property as a condition of approval of the loan
approving that person's loan application .
(3) For the purpose of this subdivision, "provides" means that the
applicant has the appraiser supply the appraisal to the lender. The
appraiser may charge a fee to cover the actual cost of supplying the
appraisal but in no case shall the fee exceed ten dollars ($10).
(b) An appraisal described in this subdivision shall comply with
all of the following:
(1) The appraisal shall be in compliance with the standards of the
Uniform Standards of Professional Appraisal Practice.
(2) The appraisal shall be an appraisal of the same residential
real property that is the subject of the loan application described
in subdivision (a).
(3) The appraisal shall have been completed not more than three
months prior to the date of the loan application described in
subdivision (a).
(b) A second or subsequent lender may not request that an
appraiser change the name of the client within an appraisal report,
unless the second or subsequent lender orders a new appraisal
assignment from that appraiser. A new appraisal assignment ordered by
a second or subsequent lender may provide for a scope of work that
is limited to a client name change.
(c) Notwithstanding subdivisions (a) and (b), a second or
subsequent lender that has received a previously completed appraisal
report on a property may require a loan applicant to purchase a new
appraisal of that property, which includes more than a client name
change, in any of the following circumstances:
(1) The appraisal is more than 30 days old, as of the date it is
received by the second or subsequent lender.
(2) An underwriter for the second or subsequent lender determines
that the appraisal performed for the first lender is not in
compliance with the Uniform Standards of Professional Appraisal
Practice or contains other material deficiencies.
(3) The appraiser that performed the previously completed
appraisal is on the second or subsequent lender's exclusionary list
of appraisers.
(4) Failure of the first lender to provide a copy of the appraisal
to the second or subsequent lender in a timely manner would cause a
prejudicial delay in closing the mortgage loan, posting potential
harm to the borrower. For purposes of this section, potential harm to
a borrower includes loss of interest rate lock, purchase contract
deadline, foreclosure proceedings, or late fees.
(c)
(d) The requirements set forth in this section shall
not apply if the second or subsequent lender does not
require the a loan applicant to pay for
the preparation of a new appraisal.
