WTF is the Appraisal Waiver Letter?
One of the many outcomes of the Great Financial Crisis on mortgage lending as an amendment of the Equal Credit Opportunity Act (Regulation B) that requires lenders to provide a free copy of all appraisals and written valuations done during the mortgage process.
A copy must be mailed to you a minimum of three days before your loan can close. If there are last minute changes to the appraisal, or you are trying to close quickly, this can cause a delay.
Most lenders will email you a copy as soon as they receive the report so waiting for a paper copy in the mail may not be necessary. Waiving this right is more about the regulatorily required waiting period than it is about receiving the appraisal.
The CFPB says, “A lender can ask you to “waive” your right to get a copy of valuations three business days before closing. This means you agree that the lender does not have to provide you with a copy three days in advance of closing. Even if you waive this right, the lender still must give you a copy of any valuations. If you waive this right and your loan closes, the lender
can then give you a copy two days before, one day before, or on the day of the closing.
Think carefully before you agree not to get a copy of valuations three days in advance of closing. For example, it could take time to look over all the information in an appraisal and decide whether it makes sense to you.”
It is your choice. Most lenders and loan officers will ask you to waive this right.
The reason is that there are changes to an appraisal that have nothing to do with the valuation of the property. An underwriter may require the appraiser to go back and state whether a seller’s concession is usual and customary to the market. Or the underwriter may want to see changes in the market commentary provided by the appraiser. Since real estate taxes often change when a house is purchase, an underwriter may require this correction.
These corrections may come late in the process when you are expecting to close. Adding another 3-day waiting period at this stage can frustrate everyone.
Some forms have three choices. One is that you do not waive your right to receive an appraisal. One is that you do waive it, but do not if there are changes that are not clerical in nature. And the third is that you waive your right even if there are clerical changes.
Other forms are simpler asking you if you want to waive the right or not.
Whether you waive your right to receive an appraisal or not, make sure you get a PDF copy for your digital files. Give it a look and ask questions. There is much information about your home in the appraisal that you may want to see. Especially the other homes in your area that the appraiser chose as comparable and the weighting of different attributes of each property as they are compared.
