§ 7500 Association Loan Appraisal Rules

Key Takeaways

•Banks can give out loans for houses or buildings, but they have to follow rules.
•Before giving a loan, the bank must get a report from a qualified person who checks the property's value.
•If the loan is for $1,000,000 or more, the person checking the property must see it in person.
•If land is empty but has a plan for roads or utilities, the bank can pretend those are already there when deciding its value.

Example

You want to buy a house and need a loan from the bank.

The bank must first get a report from a qualified person who checks the house's value. If the loan is big ($1,000,000 or more), the person must visit the house. The bank can't give you the loan until they have this report.

(a) Subject to limitations, if any, within this chapter, an association may originate, invest in, sell, purchase, service, participate, or otherwise deal in (including brokerage or warehousing) loans, including construction loans, made on the security of residential or nonresidential real property, or interests in these loans. (b) No investment in real property or a real estate loan shall be made by an association until one or more written appraisal reports, prepared at the request of an association or its agent, have been submitted to the association by a person or persons meeting the qualification standards for an appraiser as set forth in the commissioner’s regulations. No commitment to disburse shall be made by the association until the person or persons have been duly appointed and qualified as appraisers by the association. Such a person or persons shall have made a physical inspection and submitted to the association a fully documented appraisal of the real estate that would secure the loan or constitute the investment, or, in the case of a purchased loan, the person or persons have reviewed and approved an appraisal report in support of the loan. If the balance of any purchased loan is one million dollars ($1,000,000) or more, the person or persons reviewing and approving the appraisal report shall have inspected the real estate. Each appraisal report submitted to an association pursuant to this subdivision shall be signed and shall include the tax identification number, social security number, or other form of verifiable identification of the person or persons signing the appraisal report. (c) For the purpose of determining appraised value, unimproved property without offsite improvements shall be evaluated as though offsite improvements have been installed if a subdivision map has been recorded and a bond or other instrument guaranteeing installation of the offsite improvements has been accepted by the governing authorities in connection with the recording of the subdivision map. (Amended by Stats. 1988, Ch. 718, Sec. 15.)

Key Takeaways

•Banks can give out loans for houses or buildings, but they have to follow rules.
•Before giving a loan, the bank must get a report from a qualified person who checks the property's value.
•If the loan is for $1,000,000 or more, the person checking the property must see it in person.
•If land is empty but has a plan for roads or utilities, the bank can pretend those are already there when deciding its value.

Example

You want to buy a house and need a loan from the bank.

Key Takeaways

Example

Key Terms

References

§ 7500 Association Loan Appraisal Rules

Key Takeaways

Example

Key Terms

References

Key Takeaways

Example

Key Terms

Related Statutes

References

Key Takeaways

Example

Key Terms

Related Statutes

References