Real estate appraisers must be selected based on their performance and experience under regulations announced today by the Federal Reserve Board.
The guidelines require banks to pick appraisers “based on their competence, experience and knowledge,” and show “independence of the process,” according to a statement today by the Fed and four other U.S. banking regulators.
The regulations are aimed at curbing abuses, including loans to homeowners based on misstated appraisals, that helped inflate the housing price bubble. The bursting of the bubble caused the worst financial crisis since the Great Depression.
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