Cx18182 and Cx18183 are provided due to a combination of Regulation B (12 C.F.R. § 1002.14), Regulation Z (Ibid. § 1026.35[c]), and “Appraiser Independence Requirements” (“AIR”) provisions, with different, dynamic versions of the forms printing based upon lien position, loan type, and package type (details of which can be found here and here).
All versions disclose to the consumer that they are entitled to receive copies of their appraisal (and, in some cases, valuation) report within certain timeframes. Within some versions, the consumer can waive certain timeframes and receive copies at closing.
For example, the versions provided pursuant to 12 C.F.R. § 1002.14 disclose that copies will be provided promptly upon completion, but no later than three business days prior to consummation. The consumer can, in most of these versions, waive this timeframe and receives copies at consummation (as permitted by Ibid.).
There are, however, instances where such waivers cannot be observed by creditors, due to other applicable laws. For example, while Regulation B and AIR permit the waiver of their respective timing requirements, Illinois law does require an appraisal and/or valuation to be provided before closing; no exceptions:
“Licensee [under the Residential Mortgage License Act of 1987] must provide to the borrower a complete copy of any appraisal, including any appraisal generated using the Automated Valuation Model, obtained by the lender for use in underwriting the residential mortgage loan within 3 business days of receipt by the licensee, but in no event less than 24 hours prior to the day of closing. The appraisal may be sent via first class mail, commercial carrier, by facsimile or by e-mail, if the borrower has supplied an e-mail address.” (205 Ill. Comp. Stat. Ann. 635/5-11)
Thus, we will be modifying Cx18182 and Cx18183 by including language within the forms disclosing to the consumer that, despite their waiver, they may still receive copies of their appraisal and/or valuation prior to closing if required by law. The following is a sample of such language (new language is in italics):
“To accommodate the scheduled closing date, you hereby elect to waive the timing requirements to receive a copy of any and all appraisal reports and valuations concerning the subject property listed above and that you are waiving such at least three business days prior to the closing of the loan, as indicated by the date below. You will obtain copies of such at the closing of the loan. You understand that, despite this waiver, copies may still be provided to you before closing, if required by law.”
We will be adding variations of this new language to the none higher-risk mortgage versions of these forms (since a waiver is already prohibited in connection with these loans; see 12 C.F.R. Pt. 1026, Supp. I, Paragraph 35[c][ii] – 2). The language will only appear when these documents print in Initial Disclosure, Appraisal, and TILA Redisclosure packages.
This change will take effect on October 9, 2020. Questions or concerns about these changes should be directed to Client Support at 1.800.497.3584.