Appraisals.

CFR · 2024-01-01 · US · Title 7

Appraisals of collateral are required as set forth in this section. The lender is responsible for ensuring that appraisal values adequately reflect the actual value of the collateral based on an arm's length transaction. Completed appraisals should be submitted when the application is filed. If the appraisal has not been completed when the application is filed, the lender must submit an estimated appraised value. Prior to the issuance of the loan note guarantee, the estimated value must be supported with an appraisal acceptable to the agency. (a) (b) (c) (1) For construction projects, the lender must: (i) Obtain the “As Is” market value and the “prospective” market value as of the date of construction completion to determine the value of the real estate property, or (ii) Obtain an income-based appraisal as of the date of completion to determine the value of revenues to be generated by the real estate. (d) (2) Chattel appraisals must be conducted by an independent qualified appraiser and must be based on industry recognized standards and reflect the age, condition, and remaining useful life of the equipment. (e) (f) (g) (1) Appraisals must not be more than one year old. However, the Agency may request a more recent appraisal in order to reflect more current market conditions. (2) The lender must provide documentation that, in addition to the other requirements of this section pertaining to appraisers, the appraiser has the necessary experience and competency to appraise collat

official document · source cfr-2024 · id 7:§ 5001.203