(a)  Every lending institution, that accepts an application for any residential mortgage loan or any commercial mortgage loan that requires an appraisal in order to process the loan, is not permitted to use an appraisal company that is either owned by or has directors, stockholders, or employees of that lending institution.

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Terms Used In Rhode Island General Laws 19-9-3.1

  • Appraisal: A determination of property value.
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Mortgage loan: A loan made by a lender to a borrower for the financing of real property. Source: OCC
  • National Credit Union Administration: The federal regulatory agency that charters and supervises federal credit unions. (NCUA also administers the National Credit Union Share Insurance Fund, which insures the deposits of federal credit unions.) Source: OCC

(b)  Each lending institution doing business in the state pursuant to a charter or license issued under this title shall, upon request of the director of business regulation, or the director’s designee, disclose to the director those appraisal companies with which the lending institution has an ownership interest or which have directors, stockholders, or employees of the lending institution.

(c)  Any lending institution that maintains Federal Deposit Insurance Corporation (FDIC) or National Credit Union Administration (NCUA) insurance protection for its deposits is exempt from the provisions of this section.

History of Section.
P.L. 2001, ch. 128, § 5.