§ 5-20.7-24 - Mortgage loan appraisers – Relationship with lending institution.
SECTION 5-20.7-24
§ 5-20.7-24 Mortgage loan appraisers– Relationship with lending institution. – (a) Every bank, trust company, loan investment company, mortgage company, andcredit union or any other lending institution, which accepts an application forany residential mortgage loan or any commercial mortgage loan which requires anappraisal in order to process the loan is not permitted to use an appraisalcompany that is either owned by or has directors, stockholders, or employees ofthat bank, trust company, loan investment company, mortgage company, and creditunion or any other lending institution.
(b) All appraisal companies doing business in the state arerequired to disclose with the Rhode Island department of business regulationthose lending institutions that may have an ownership interest in the appraisalcompany. If an ownership relationship exists between the lending institutionand an appraisal company, then the appraisal company is prohibited fromconducting any appraisals for that lending institution.
(c) Any appraisal companies doing business within the stateare prohibited from doing business within the state if a violation of thischapter is discovered.
(d) Any lending institution which maintains Federal DepositInsurance Corporation (FDIC) or National Credit Union Association (NCUA)insurance protection for its deposits at a lending institution is exempt fromthis provision.
(e) A violation of this section shall also be held to be aviolation of chapter 13.1 of title 6.