For the purposes of this article:
(1) "Appraisal management company" means an external third party, in connection with valuing properties, collateralizing mortgage loans, or incorporating mortgages into a securitization. The third party must be authorized either by a creditor of a consumer credit transaction secured by a consumer's principal dwelling or by an underwriter or by other principal in the secondary mortgage markets that oversees a network or panel of more than fifteen certified or licensed appraisers in a state or twenty-five or more nationally within a given year in order to:
(a) recruit, select, and retain appraisers;
(b) contract with licensed and certified appraisers to perform appraisal assignments;
(c) manage the process of having an appraisal performed, including providing administrative duties such as receiving appraisal orders and appraisal reports, submitting completed appraisal reports to creditors and underwriters, collecting fees from creditors and underwriters for services provided, and reimbursing appraisers for services performed; or
(d) review and verify the work of appraisers.
(2) "Appraisal management services" means the process of receiving a request for the performance of real estate appraisal services from a client and, for a fee paid by the client, entering into an agreement with one or more certified or licensed appraisers, who are independent contractors, to perform the real estate appraisal services contained in the request.
(3) "Appraiser panel" means a group of certified or licensed appraisers, who are independent contractors, selected by an appraisal management company to perform real estate appraisal services for the appraisal management company.
(4) "Appraisal review" means the act, by a certified or licensed appraiser employed by an appraisal management company, of developing and communicating an opinion about the quality of work of another appraiser that was performed as part of an appraisal assignment. Appraisal review does not include:
(a) an examination by an unlicensed employee of an appraisal management company for an appraisal solely for grammatical errors, typographical errors, or other similar errors; or
(b) a quality control examination for completeness that does not make a valuation change.
(5) "Client" means a person or entity that contracts with, or otherwise enters into an agreement with, an appraisal management company for the purpose of real estate appraisal services.
(6) "Controlling person" means:
(a) an owner, officer, or director of a corporation, partnership, limited liability company, or other business entity that seeks to offer an appraisal management service in this State;
(b) an individual employed, appointed, or authorized by an appraisal management company authorized to enter a management agreement with certified or licensed appraisers, who are independent contractors, for the performance of real estate appraisal services; or
(c) an individual who possesses, directly or indirectly, the power to direct or cause the direction of the management or policies of an appraisal management company.
(7) "Independent contractor" means a person in a trade, business, or profession in which he offers his services to the general public, in which the payer has the right to control or direct only the result of the work and not what will be done and how it will be done.
(8) "Real estate appraisal services" means the practice of developing an opinion of the value of real property in conformance with the Uniform Standards of Professional Appraisal Practice (USPAP) published by the Appraisal Foundation.
(9) "Payor" means a person or entity responsible for making payment for the appraisal.
HISTORY: 2017 Act No. 32 (S.279), Section 1, eff May 10, 2017.
Editor's Note
2017 Act No. 32, Section 5, provides as follows:
"SECTION 5. This act takes effect upon approval by the Governor. In the event that a registration process is unavailable upon the effective date of this act, an appraisal management company already conducting business in this State may continue to conduct business until one hundred twenty days after a registration process becomes available."