Tennessee

Reviewer Requirements

  • Reviewers must be licensed appraisers in state of Tennessee
    • TN HB No. 3191 Section 14:

SECTION 14. Any employee or independent contractor of the appraisal management company who performs an appraisal review services on an appraisal done on real property located within Tennessee must be an individual who holds a license as defined in § 62-39-102(15) or certification as defined in § 62-39-102(14). Letters of engagement shall include instructions to the appraiser to decline the appraisal review assignment in the event the appraiser is not geographically competent or the assignment falls outside the appraiser’s scope of practice restrictions.

 

  • TN HB No. 3191 Section 3-(4):

 

(4) “Appraisal review” means the act or process of developing and

communicating an opinion about the quality of another appraiser’s work that was

performed as part of an appraisal assignment, except that an examination of an

appraisal for grammatical, typographical, or other similar errors shall not be an

appraisal review;

 

Scope of Law

  • No specific distinction between residential and commercial real estate

 

  • TN HB No. 3191 Section 3-(1):

(1) “Appraisal” means the act or process of developing an opinion of value of identified real estate. That opinion of value may be numerically expressed either as a specific amount, as a range of numbers or as a relationship to a previous value opinion or other numerical benchmark. The term “appraisal” does not include any opinion of value referred to as evaluations under

§ 62-39-104;

Reviewing Provisions

  • Must conduct internal quality control reviews on a periodic basis to assure compliance with USPAP

 

  • TN HB No. 3191 Section 4-(b)-(8):

(b) The registration required by subsection (a) shall, at a minimum, include the following:

 

(8) A certification that the entity has a system in place to review the work of all appraisers who are performing real estate appraisal services in Tennessee for the appraisal management company on a periodic basis to validate that the real estate appraisal services are being conducted in accordance with Uniform Standards of Professional Appraisal Practice (USPAP), pursuant to Section 17 of this act;

 

  • TN HB No. 3191 Section 17:

 

SECTION 17. Each registered appraisal management company shall certify to the commission on a biannual basis that it has a system in place to perform an appraisal review on a periodic basis of the work of all appraisers who are performing appraisals in Tennessee for the appraisal management company to validate that the appraisals are being conducted in accordance with Uniform Standards of Professional Appraisal Practice (USPAP). An AMC shall report to the commission the results of any appraisal reviews in which an appraisal is found to be substantially non-compliant with USPAP or state/federal laws pertaining to appraisals.

 

Appraiser Requirements

Appraiser Competency

  • Appraisers must feel competent to complete assignments given to them

 

  • TN HB No. 3191 Section 21-(2):

SECTION 21. An appraisal management company shall not:

(2) Require an appraiser to prepare an appraisal if the appraiser, in the appraiser’s own independent professional judgment, believes the appraiser does not have the necessary expertise for the assignment or for the specific geographic area and has notified the AMC and declined the assignment;

 

Record Keeping

 

  • TN HB No. 3191 Section 4-(b)-(9):

(b) The registration required by subsection (a) shall, at a minimum, include the following:

 

(9) A certification that the entity maintains a detailed record of each service request that it receives for appraisal services within the state of Tennessee and the appraiser who performs the real estate appraisal services for the appraisal management company, pursuant to Section 18 of this act;

 

  • TN HB No. 3191 Section 18:

SECTION 18. Each appraisal management company seeking to be registered shall certify to the commission biannually that it maintains a detailed record of each service request for appraisal services within the state of Tennessee and that it receives and of each appraiser who performs an appraisal for the appraisal management company in the state of Tennessee.

 

Licensing Disclosure

  • Must disclose registration number on letters of engagement

 

  • TN HB No. 3191 Section 24-(c):

(c) An appraisal management company shall be required to disclose the registration number on each engagement letter utilized in assigning an appraisal request for real estate appraisal assignments within the state of Tennessee.

 

Communications With Appraisers

  • Must provide instructions to appraisers regarding declining assignments for which they feel incompetent

 

  • TN HB No 3191 Section 13:

SECTION 13. Prior to placing an assignment, for real estate appraisal services within the state of Tennessee, with an appraiser on the appraiser panel of an appraisal management company, the appraisal management company shall have a system in place to verify that the appraiser receiving the assignment holds a credential in good standing in the state of Tennessee. Letters of engagement shall include instructions to the appraiser to decline the assignment in the event the appraiser is not geographically competent or the assignment falls outside the appraiser’s scope of practice restrictions.

 

Communication With Board

Billing/ Payment

  • Must state fees paid to appraiser and AMC fees separately to client

 

  • TN HB No. 3191 Section 19-(b):

(b) An appraisal management company shall separately state to the client, the fees paid to an appraiser for appraisal services and the fees charged by the appraisal management company for services associated with the management of the appraisal process, including procurement of the appraiser’s services.

 

  • Must pay appraisers within 60 days of their transmission of completed appraisal report

 

  • TN HB No. 3191 Section 22:

SECTION 22.

Each appraisal management company shall, except in cases of breach of contract or substandard performance of services, make payment to an appraiser for the completion of an appraisal or valuation assignment within sixty (60) days (unless a mutually agreed upon alternate payment schedule exists) from when the appraiser transmits or otherwise provides the completed appraisal or valuation study to the appraisal management company or its assignee.

 

Employee Training

 

Removal of Appraisers from Panel

  • Specific guidelines for removal of appraisers from panel

 

  • TN HB No. 3191 Section 25-(a):

SECTION 25.

(a) Except within the first thirty (30) days after an appraiser is first added to the appraiser panel of an appraisal management company, an appraisal management company may not remove an appraiser from its appraiser panel, or otherwise refuse to assign requests for real estate appraisal services to an appraiser without:

 

(1) Notifying the appraiser in writing of the reasons why the appraiser is being removed from the appraiser panel of the appraisal management company;

(2) If the appraiser is being removed from the panel for illegal conduct, violation of the Uniform Standards of Professional Appraisal Practice (USPAP), or a violation of state licensing standards, describing the nature of the alleged conduct or violation; and

(3) Providing an opportunity for the appraiser to respond to the notification of the appraisal management company.

 

Misc

  • Registrations valid for two years

 

  • TN HB No. 3191 Section 7:

SECTION 7. Registration shall be valid for two (2) years from its issuance.

  • Time frames for assignments must be reasonable

 

  • TN HB No. 3191 Section 21-(3):

SECTION 21. An appraisal management company shall not:

(3) Require an appraiser to prepare an appraisal under a time frame that the appraiser, in the appraiser’s own professional judgment, believes does not afford the appraiser the ability to meet all the relevant legal and professional obligations if the appraiser has notified the AMC and declined the assignment;

 

  • Must apply for enrollment on federal registry of AMCs if we are qualified

 

  • TN Real Estate Appraiser Commission Chapter 1255-08-05:

 

1255-08-05 FEDERAL APPRAISER REGISTRY.

Registrants who are qualified for enrollment in the federal roster or registry of Appraisal Management

Companies must apply for enrollment or reinstatement of such enrollment in same upon a form approved by the Commission accompanied by the fee established for that purpose by the appropriate federal agency or instrumentality.