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NCUA Seeks Input on Raising the Appraisal Threshold

Phil Hall
Nov 22, 2019
Photo credit: Getty Images/designer491

The National Credit Union Administration (NCUA) is seeking comment on a proposed rule raising the threshold for requiring a residential real estate appraisal from $250,000 to $400,000.
According to the regulatory agency, the proposed change would align the NCUA’s appraisal rule with a final rule issued in October by the Federal Reserve System, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency. The proposed rule incorporates the existing statutory requirement that appraisals be subject to appropriate review for compliance with the Uniform Standards of Professional Appraisal Practice, and the NCUA noted that federally insured credit unions would still need to obtain a written estimate of market value for properties that fall below the appraisal threshold.
“The NCUA has taken another positive step forward in regulatory reform by raising the appraisal level for residential mortgage loans,” said NCUA Chairman Rodney E. Hood. “The process of securing a loan and purchasing a home can be time-consuming and stressful, particularly for middle- and working-class borrowers and those who live in underserved areas. So, any reasonable steps we can take to reduce the time needed to complete real estate transactions, to simplify the process, and to lower costs are well worth considering.”
Comments on the proposed rule must be received within 60 days of its publication in the Federal Register.
Earlier this year, the NCUA increased the threshold on appraisals for non-residential real estate loans from $250,000 to $1 million, whereas the other regulators set that threshold at $500,000.

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