COMMITTEE SUBSTITUTE
FOR
H. B. 2097
(By Delegates Farris and Beane)
(Originating in the House Committee on the Judiciary)
[March 2, 1995]
A BILL to amend and reenact sections four and five, article
fourteen, chapter thirty-seven of the code of West Virginia,
one thousand nine hundred thirty-one, as amended, relating
to circumstances under which the requirement that
appraisements of property be performed by licensed or
certified appraisers does not apply; increasing the value of
real estate which certain financial institutions may
consider to be potential collateral for a loan below which
the requirement that an appraisement of the real estate be
performed by a licensed or certified appraiser does not
apply from one hundred thousand dollars to two hundred fifty
thousand dollars; requiring that loan customers be notified
of the financial institution's intention to use an
evaluation rather than an appraisement of the real estate in such circumstance and provide the customer the opportunity
to elect an evaluation by a certified or licensed appraiser;
payment of the cost of such elected evaluation; increasing
the membership of the real estate appraiser licensing and
certification board from seven to nine members; increasing
the number of members of the board who must be real estate
appraisers having at least five years experience in
appraisal as a principal line of work immediately preceding
their appointment from two to four members; and increasing
the number of members which may be appointed to the board
from each congressional district from one to two members.
Be it enacted by the Legislature of West Virginia:
That sections four and five, article fourteen, chapter
thirty-seven of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, be amended and reenacted to read
as follows:
ARTICLE 14. THE REAL ESTATE APPRAISER LICENSING AND
CERTIFICATION ACT.
§
37-14-4. Exceptions to license or certification requirement.
This article does not apply to:
(a) A real estate broker or salesperson licensed by this
state who, in the ordinary course of his or her business, gives
an opinion to a potential seller or third party as to the recommended listing price of real estate or an opinion to a
potential purchaser or third party as to the recommended purchase
price of real estate, when this opinion as to the listing price
or the purchase price is not to be referred to as an appraisal,
no opinion is rendered as to the value of the real estate and no
fee is charged;
(b) A casual or drive-by inspection of real estate in
connection with a consumer loan secured by the said real estate,
when the inspection is not referred to as an appraisal, no
opinion is rendered as to the value of the real estate and no fee
is charged for the inspection;
(c) An employee who renders an opinion as to the value of
real estate for his full-time employer, for the employer's
internal use only and performed in the regular course of the
employee's position, when the opinion is not referred to as an
appraisal and no fee is charged;
(d) Appraisals of personal property, including, but not
limited to, jewelry, household furnishings, vehicles and
manufactured homes not attached to real estate;
(e) Any officer or employee of the United States, or of the
state of West Virginia or a political subdivision thereof, when
the employee or officer is performing his official duties:
Provided, That such individual does not furnish advisory service
for compensation to the public or act as an independent
contracting party in West Virginia or any subdivision thereof in
connection with the appraisal of real estate or real property:
Provided, however, That this exception shall not apply with
respect to federally related transactions as defined in Title XI
of the United States Code, entitled "Financial Institutions
Reform, Recovery, and Enforcement Act of 1989"; and
(f) Any evaluation of the value of real estate serving as
collateral for a loan made by a financial institution insured by
the federal deposit insurance corporation:
Provided, That: (1)
The amount of the loan is
equal to or less than
fifty thousand
dollars or such other amount not to exceed one two hundred
fifty
thousand dollars
established by the federal deposit insurance
corporation, the board of governors of the federal reserve
system, the office of the comptroller of the currency or the
office of thrift supervision pursuant to authority granted under
Title XI of the United States Code, entitled "Financial
Institutions Reform, Recovery, and Enforcement Act of 1989"
applicable to a particular insured financial institution as the
level below which collateral evaluations need not be performed by
a licensed or certified appraiser; (2) the evaluation is used solely by the lender in its records to document the collateral
value; (3) the evaluation clearly indicates on its face that it
is for the lender's internal use only; (4) the evaluation shall
not be labeled an "appraisal"; and (5) the evaluation be on a
form approved by the board. Individuals performing these
evaluations may be compensated for their services.
The lender
shall notify its customer if it intends to use an unlicensed
evaluator and give that customer the opportunity to elect an
evaluation, by a certified or licensed appraiser, the cost of
which shall be paid as agreed between the lender and the
customer.
§37-14-5. Board created; appointment, qualifications, terms,
oath, etc., of members; quorum; meetings; when
members are disqualified from participation;
compensation; records; office space; personnel.
(a) There is hereby created the West Virginia real estate
appraiser licensing and certification board which consists of
seven nine members appointed by the governor with the advice and
consent of the Senate. Each member shall be a resident of the
state of West Virginia.
Two Four members shall be real estate
appraisers having at least five years' experience in appraisal as
a principal line of work immediately preceding their appointment,
two members shall be selected from financial institutions having at least five years' experience in real estate lending, and three
members who shall not be engaged in the practice of real estate
appraisal, real estate brokerage or sales or have any financial
interest in such practices. No member of the board may
concurrently be a member of the West Virginia real estate
commission. Not more than
one two appraiser
member members may
be appointed from each congressional district.
(b) Appointments shall be for a three-year term, except of
the members first appointed, three shall serve for two years and
one for one year. Each real estate appraiser appointed after the
first day of January, one thousand nine hundred ninety-one, shall
have appraisal as their principal work and must be a state
certified real estate appraiser under this article at the time of
appointment and during the term of appointment. No member
appointed shall serve for more than six consecutive years.
Before entering upon the performance of his duties, each member
shall subscribe to the oath required by section five, article
four of the Constitution of this state. The governor shall,
within sixty days following the occurrence of a vacancy on the
board, fill the same by appointing a person for the unexpired
term of, and meeting the same requirements for membership as, the
person vacating said office. Any member may be removed by the governor in case of incompetency, neglect of duty, gross
immorality or malfeasance in office.
(c) The board shall elect a chairman. A majority of the
members of the board shall constitute a quorum. The board shall
meet at least once in each calendar quarter on a date fixed by
the board. The board may, upon its own motion, or shall upon the
written request of three members of the board, call additional
meetings of the board upon at least twenty-four hours' notice.
No member shall participate in a proceeding before the board to
which a corporation, partnership or unincorporated association is
a party, and of which he is or was at any time in the preceding
twelve months a director, officer, owner, partner, employee,
member or stockholder. A member may disqualify himself from
participation in a proceeding for any other cause deemed by him
to be sufficient. Each member shall receive fifty dollars for
each day or portion thereof spent in attending meetings of the
board and shall be reimbursed for all reasonable and necessary
expenses incurred incidental to his duties as a member of the
board.
(d) The board shall keep an accurate record of all of its
proceedings and make certificates thereupon as may be required by
law.