Skip to main content

Pandemic Spurs Need to Extend Appraisal Waivers in North Dakota 

North Dakota state leaders this week sent a letter to the Appraisal Subcommittee (ASC) of the Federal Financial Institutions Examination Council (FFIEC) asking for an extension to the state’s temporary appraisal licensing requirement waiver due in part to the impact of the Covid-19 pandemic. 

Last summer, the ASC approved a 12-month waiver that expires on Aug. 7, 2020. The increased regulatory thresholds and waiver have provided much-needed flexibility for North Dakota citizens, the letter said. A survey showed that approximately 64% of responding banks said they had used the waiver option, with more than 55% reporting they used it on at least five occasions, the letter said.

The waiver was requested due to an appraiser scarcity that has resulted in appraisal delays. Because of the waiver, banks in North Dakota can waive appraiser credentialing requirements for federally related transactions under $1 million for commercial real estate transactions. The waiver expired for certain residential real estate transactions when the federal agencies increased appraisal exemption threshold limits. 

The temporary waiver required North Dakota leaders to develop a plan to identify potential solutions to the appraisal shortage. The letter detailed progress in that direction but noted that the pandemic has created a stress on the economy and slowed efforts to address the appraisal shortage.

Although solutions are being sought to correct the scarcity of appraisers, no lasting effect has been realized to date, the letter said, adding that the pandemic has “effectively halted all work on the issue for most of 2020.” A waiver extension would provide flexibility for borrowers during the economic recovery, it further explained.

The letter was signed by North Dakota Governor Doug Burgum and co-signed by Commissioner of Financial Institutions Lise Kruse as well as the presidents of the North Dakota Bankers Association, Credit Union Association of the Dakotas and Independent Community Banks of North Dakota. 

North Dakota Rep. Kelly Armstrong also sent a letter to the ASC supporting the extension. “I am confident the proposed waiver extension will accelerate appraisal completions and encourage solutions for the shortage of appraisers,” the Congressman’s letter said.

The North Dakota Indian Affairs Commission sent a separate letter in support of an extension.

exit