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Real Estate BPO Laws by State

Real Estate BPO Laws by State

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  • 1. 734 15th St. NW Suite 900 Washington, DC 20005 888-498-1114……………………………………………………………………………………………………… www.revaa.orgDon KellyExecutive Director202-942-9461Don.kelly@revaa.orgJune 2011 STATE LAW SURVEY: BROKER PRICE OPINIONS EXECUTIVE SUMMARYThis document provides an overview of the current status (as of June 2011) of thelaws of the fifty states and the District of Columbia with respect to thepermissibility and use of broker price opinions (BPOs) sometimes referred to as acomparative market analysis (CMA).State laws addressing the permissibility of BPOs are typically located either in theappraiser licensing statute (as an exemption to the appraiser licensingrequirement) or in the real estate licensing statute (as a permissible activity).Most of these state laws were enacted prior to the current financial crisis. Withthe rise in mortgage delinquencies, regulatory requirements, and enhanced duediligence criteria, financial institutions have increasingly relied on BPOs to provideinformation in the loan delinquency and portfolio analysis context.Because most state laws pre-date the mortgage crisis, many are silent about theuse of BPOs in these contexts. Some of these pre-crisis state laws provide a safeharbor from appraiser licensing requirements for real estate agents and brokersperforming BPOs in the brokerage context (i.e., for a seller or purchaser of ahome), but are otherwise silent.Other state laws enacted prior to the current crisis contain broader provisions,allowing real estate brokers and agents to perform BPOs for third parties, or evento provide appraisal services, without the necessity of appraiser licensing,typically unless federal law requires an appraisal.Some states that have looked at this issue since the financial crisis haveamended their laws specifically to allow the delivery of broker price opinions forlienholders, as long as the BPO is not the primary basis of a loan originationdecision (aligning these laws with Section 1126 of the Dodd-Frank Act). Thesestates join a number of other states that already specifically allowed BPOs to beperformed in the lienholder or servicer context.A number of state statutes contain ambiguous language that may render thosestatutes subject to varying interpretations. This document is not intended toprovide legal advice, and should not be relied on for legal advice.
  • 2. Nine (9) states specifically Thirty-five (35) states allow Seven (7) states provideallow BPOs to be BPOs to be performed for safe harbor for BPOs inperformed for lienholders third parties or otherwise brokerage context; silent broadly allow them as to lienholdersArkansas (2011) Alabama ConnecticutCalifornia Alaska DelawareHawaii* (2011) Arizona New MexicoMinnesota** (2011) Colorado North CarolinaMississippi*** (2011) District of Columbia PennsylvaniaNebraska (2010) Florida Rhode IslandNevada (2009) Georgia WyomingNew Jersey Idaho  Oregon Illinois   Indiana   Iowa   Kansas   Kentucky   Louisiana   Maine   Maryland   Massachusetts   Michigan   Missouri   Montana   New Hampshire   New York   North Dakota   Ohio   Oklahoma   South Carolina   South Dakota   Tennessee   Texas   Utah   Vermont   Virginia   Washington   West Virginia   Wisconsin     * Effective upon approval ** Effective August 1, 2011 *** Effective July 1, 2011   2  
  • 3. AlabamaBroadly permissible: allows real estate brokers andsalespersons to render an opinion to a third party as to therecommended listing price of real estate.Alabama Section 34-27A-3 (c)Except where required by, or where necessary to fully comply with the provisions of theFinancial Institutions Reform, Recovery and Enforcement Act of 1989, Pub. L. No. 101- 73,as amended, and regulations issued pursuant thereto, this chapter shall not apply to, orpreclude, a person who is not a licensed real estate appraiser from performing realestate market analysis, in that persons capacity as a licensed real estate broker orsalesperson under this title, and this chapter shall not apply to a licensed real estatebroker or salesperson, who in the ordinary course of business, gives an opinion to apotential seller or third party as to the recommended listing price of real estate, or anopinion to a potential purchaser or third party as to the recommended purchase price ofreal estate; and this chapter shall not apply to any employee, officer, director, partner, orsimilar person making a valuation, analysis, market study, or other appraisal for his or heremployer or principal, including those related to any real estate related financialtransactions for or on behalf of a financial institution. The words "employer or principal" asused in this subsection shall include any subsidiary, parent, affiliate, or partner of thedirect employer or principal. This chapter shall not require now or in the future any personwho lists or otherwise offers property for sale to have an appraisal of that property. AlaskaBroadly permissible: allows non-appraisers to appraise realestate if they do not hold themselves out as appraisers, exceptwhere required by federal law.Alaska Statutes § 08.87.340Appraisals by uncertified appraisers permitted. Nothing in this chapter precludes aperson who is not certified as a real estate appraiser from appraising real estate forcompensation if the person does not hold out to be a certified appraiser and if appraisalby a certified appraiser is not required by federal law.   3  
  • 4. ArizonaBroadly Permissible: allows real estate brokers andsalespersons to render a price opinion if it is not referred to asan appraisal.Arizona Professions & Occupations Section 32-3602This chapter [appraiser licensing] does not apply to: 1. A real estate broker or salesperson who is licensed in this state and who, when acting as such, gives an opinion as to the price of real estate if this opinion is not referred to as an appraisal. ArkansasBroadly Permissible: allows real estate licensees to render aBPO except as the primary basis for a loan origination decisionfor a consumer’s principal residence. Effective March 29, 2011.SECTION 1. Arkansas Code Title 17-42-103, concerning definitions under the Real EstateLicense Law, is amended to add an additional subsection to read as follows:(15) "Brokers price opinion" means an estimate prepared by a licensee that details the probable selling price of real estate and provides a varying level of detail about the real estates condition, market, and neighborhood, and information about sales of comparable real estate.SECTION 2. Arkansas Code Title 17, Chapter 42, Subchapter 1 is amended to add anadditional section to read as follows:17-42-109. Brokers price opinions.(a) A licensee may prepare, provide, and collect a fee for issuing a brokers price opinion for: (1) An existing or potential seller for the purposes of listing and selling real estate; (2) An existing or potential buyer of real estate; (3) A third party making decisions or performing due diligence related to the potential listing, offering, sale, exchange, option, lease, or acquisition price of real estate; or (4)(A) An existing or potential lienholder.   4  
  • 5. (B) However, a brokers price opinion prepared for an existing or potential lienholder in conjunction with the purchase of a buyers principal residence shall not be used as the primary basis to determine the value of the buyers principal residence for the purpose of a loan origination of a residential mortgage loan secured by the buyers principal residence.(b) The Arkansas Real Estate Commission may prescribe rules for the preparation and issuance of a brokers price opinion.(c) Licensees shall have the authority to prepare and provide broker price opinions pursuant to this section, notwithstanding the provisions of § 17-14-101 et seq., § 17-14- 201 et seq., and § 17-14-301 et seq.(d) A brokers price opinion or market analysis issued by a real estate licensee shall not contain the terms "market value", "appraised value", or "appraisal". CaliforniaBroadly Permissible: allows real estate licensees to performservices for lenders in connection with loans secured directly orcollaterally by liens on real property.California Business & Professions CodeSection 11302The term “appraisal” does not include an opinion given by a real estate licensee orengineer or land surveyor in the ordinary course of his or her business in connection witha function for which a license is required under Chapter 7 (commencing with Section6700) or Chapter 15 (commencing with Section 8700) of Division 3, or Chapter 3(commencing with Section 10130) or Chapter 7 (commencing with Section 10500) andthe opinion shall not be referred to as an appraisal.Section 10131A real estate broker within the meaning of this part is a person who, for a compensationor in expectation of a compensation, regardless of the form or time of payment, does ornegotiates to do one or more of the following acts for another or others: .... (d) Solicits borrowers or lenders for or negotiates loans or collects payments or performs services for borrowers or lenders or note owners in connection with loans secured directly or collaterally by liens on real property or on a business opportunity.   5  
  • 6. ColoradoBroadly Permissible: allows real estate brokers and salespeopleto render a broker price opinion as long as they do notrepresent themselves as appraisers, and as long as the opinionis not used to obtain financing.Colorado Title 12, Article 61, Part 7, Section 702“Real estate appraiser” or “appraiser” means any person who provides for a fee or asalary an estimate of the nature, quality, value or utility of an interest in, or aspect of,identified real estate and includes one who estimates value and who possesses thenecessary qualifications, ability, and experience to execute or direct the appraisal of realproperty. (b) Real estate appraiser does not include: (II) Any person licensed as a broker or salesperson pursuant to part I of this article who provides an opinion of value that is not represented as an appraisal and is not used for purposes of obtaining financing. ConnecticutSafe Harbor for Listings: exempts real estate brokers andsalespeople from appraiser licensing requirement in brokeragecontext.Connecticut § 20-526ExceptionsThe provisions of sections 20-500 to 20-528, inclusive, concerning the certification,licensing, limited licensing or provisional licensing of real estate appraisers shall not applyto... (2) any licensed real estate broker or real estate salesperson who estimates the value of real estate as part of a market analysis performed for the owner of the real estate or a designee of the owner, on such terms as may be agreed upon between such owner or the owners designee and the real estate broker or real estate salesperson, for the purpose of (A) a prospective listing or sale of such real estate, (B) providing information to the seller or landlord under a listing agreement, or (C) providing information to a prospective buyer or tenant under a buyer or tenant agency   6  
  • 7. agreement, provided such estimate of value shall not be referred to or be construed as an appraisal. DelawareSafe Harbor for Listings: exempts real estate brokers andsalespeople from appraiser licensing requirement in brokeragecontext.Delaware Statute Chapter 40, Title 24, Section 4019This chapter [appraiser licensing] shall not apply to any Delaware licensed real estatesalesperson or broker, who prepares a competitive market analysis survey used only forthe purpose of listing a property for sale or lease, nor to any individual, who prepares realestate appraisals for the licensees full-time employer for the employers internal use only,and which is performed in the regular course of employees position. District of ColumbiaBroadly permissible: allows real estate licensees to rendercomparative market analyses (CMAs) as long as theyphysically inspect the property, do not hold themselves out asappraisers, and do not call the CMA an appraisal.District of Columbia Municipal Regulations § 2325PERSONS EXEMPT FROM LICENSUREDCMR § 2325.1No person in the District of Columbia shall conduct an appraisal for a federally related ornon-federally related real estate or real property transaction or represent him or herselfas holding a license issued by the Board unless he or she holds an active District ofColumbia license.DCMR § 2325.4Nothing in this chapter or the Act prohibits a person who holds an active real estatebroker or real estate license issued by the D.C. Board of Real Estate from giving anopinion on the price of real estate for the purpose of a prospective listing or sale, or whengiving a Competitive Market Analysis (CMA), if the opinion or CMA complies with therequirements of 17 DCMR 2609.15.DCMR § 2609.15A licensee may give an opinion of the price of real estate for the purpose of a   7  
  • 8. prospective listing or sale or when making a Competitive Market Analysis (CMA) if: (a) The licensee physically inspects the property; and (b) The resulting opinion or CMA does not refer to an appraisal and is not presented as an appraisal. FloridaBroadly permissible: allows real estate brokers andsalespersons to render BPOs/CMAs as long as they do not holdthemselves out as appraisers and do not call the BPO/CMA anappraisal.Florida Statute Section 475.612(2) This section [appraiser licensing] does not preclude a Florida licensed real estate broker, sales associate, or broker associate who is not a Florida certified or licensed real estate appraiser from providing valuation services for compensation. Such persons may continue to provide valuation services for compensation so long as they do not represent themselves as certified, licensed, or registered under this part.(3) This section does not apply to a real estate broker or sales associate who, in the ordinary course of business, performs a comparative market analysis, gives a price opinion, or gives an opinion of the value of real estate. However, in no event may this comparative market analysis, price opinion, or opinion of value of real estate be referred to or construed as an appraisal.   8  
  • 9. GeorgiaBroadly permissible: allows real estate brokers andsalespeople to render price opinions/CMAs to third parties aslong as they do not refer to them as appraisals.Regulatory Guidance: the Georgia Attorney General hasissued an opinion stating that it interprets the law to allowBPOs/CMAs to be performed for lending institutions, becausethey are third parties. Georgia AG Official Opinion 99-15.O.C.G.A. § 43-39A-24 (c) This chapter [appraiser licensing] shall not apply to... (2) A real estate licensee licensed in accordance with Chapter 40 of this title who, in the ordinary course of real estate brokerage business, gives a brokers price opinion, competitive market analysis, or any other written or oral opinion to a potential seller, purchaser, landlord, tenant, or third party as to the recommended listing, lease, rental, or purchase price of real estate or real property; provided, however, that this opinion as to the listing, lease, rental, or purchase price shall not be used as an appraisal… HawaiiBroadly permissible: allows real estate brokers andsalespeople to give price opinions/CMAs to third parties aslong as they do not refer to them as appraisals and do notrepresent themselves to be appraisers, except where federallaw requires an appraisal.Pending in the Hawaii Legislature, if passed, as expected,effective immediately.SECTION 1. Section 466K-4, Hawaii Revised Statutes, is amended to read as follows: §466K-4 Practice as a real estate appraiser; uniform standards. (a) No person may practice as a real estate appraiser in this State unless that person has been licensed or certified to practice in accordance with this chapter and rules adopted by the director of commerce and consumer   9  
  • 10. affairs pursuant to chapter 91. All real estate appraisers who are licensed or certified to practice in this State shall comply with the current uniform standards of professional appraisal practice approved by the director when performing appraisals in connection with a federally or non-federally related real estate transaction. (b) This section shall not apply to any real estate appraiser employed by any county for purposes of valuing real property for ad valorem taxation. (c) This section shall not apply to a real estate broker or real estate salesperson licensed under chapter 467 who provides an opinion as to the estimated price of real estate, provided that: (1) The opinion as to the estimated price shall state that it is not an appraisal, (2) The real estate licensee shall not represent that the licensee is a certified or licensed real estate appraiser; and (3) If the real estate licensee receives compensation related to the sale of property, the licensee shall not receive any additional compensation, fee, or other consideration for providing an opinion as to the estimated price of that property. SECTION 3. This Act shall take effect upon its approval. IdahoBroadly permissible: allows real estate brokers to render abroker price opinion as long as it contains the prescribedinformation, is not called an appraisal, and is not used in lieu ofan appraisal.Idaho Statutes § 54-4105(2) The provisions of this chapter [appraiser licensing] shall not apply to a licensed real estate broker, associate broker or salesperson who, in the ordinary course of his business gives an opinion of the price of real estate for the purpose of a prospective listing or sale, provided that such person does not represent himself as being a state licensed or certified real estate appraiser.(3) The provisions of this chapter [appraiser licensing] shall not prohibit a real estate broker or associate broker licensed under chapter 20, title 54, Idaho Code, whose license is active and in good standing, from rendering a broker’s price opinion, for which the broker may charge a fee, provided the broker’s price opinion complies with   10  
  • 11. the following requirements: (a) The broker’s price opinion shall be in writing and contain the following: (i) A statement of the intended purpose of the price opinion; (ii) A brief description of the subject property and property interest to be priced; (iii) The basis of reasoning used to reach the conclusion of the price, including the applicable market data and/or capitalization computation; (iv) Any assumptions or limiting conditions; (v) A disclosure of any existing or contemplated interest of the broker(s) issuing the opinion; (vi) The name and signature of the broker(s) issuing the price opinion and the date of its issuance; (vii) A disclaimer that, unless the broker is licensed under the Idaho real estate appraisers act, chapter 41, title 54, Idaho Code, the report is not intended to meet the uniform standards of professional appraisal practice; (viii) A disclaimer that the broker’s price opinion is not intended to be an appraisal of the market value of the property, and that if an appraisal is desired, the services of a licensed or certified appraiser should be obtained.The broker’s price opinion permitted under this chapter may not be used as an appraisal,or in lieu of an appraisal, in a federally related transaction. IllinoisBroadly Permissible: allows real estate licensees to renderbroker price opinions/CMAs, except where federal law requiresan appraisal.225 Illinois Compiled Statutes (ILCS) § 458/5-5(c) (d) The licensing requirements of this Act [appraiser licensing act] do not require a person who holds a valid license pursuant to the Real Estate License Act of 2000, to be licensed as a real estate appraiser under this Act, unless that person is providing or attempting to provide an appraisal report, as defined in Section 1-10 of this Act, in connection with a federally- related transaction.Nothing in this Act shall prohibit a person who holds a valid license under the Real EstateLicense Act of 2000 from performing a comparative market analysis or broker priceopinion.   11  
  • 12. IndianaBroadly Permissible: allows real estate brokers to render brokerprice opinions except where federal law requires an appraisal.Indiana Code § 25-34.1-3-8Real estate appraiser licensure and certification program; necessity for licensure orcertification (a) This section does not preclude a person who:(1)is not licensed or certified as a real estate appraiser under this section; and (2) is licensed as a broker under this article; from appraising real estate in Indiana for compensation. (b) As used in this section, “federal act” refers to Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act (12 U.S.C. 3331 through 3351).(i) Notwithstanding IC 25-34.1-3-2(a):**** (1) only a person who receives a license or certificate issued under the real estate appraiser licensure and certification program established under this section may appraise real estate involved in transactions governed by: (A) the federal act; and (B) any regulations adopted under the federal act; as determined under rules adopted by the commission, as recommended by the board.§ 24-5-23.5-1 (a) As used in this chapter, “appraisal” means an estimation that: (1) represents the final opinion of the value of real property that is the subject of a real estate transaction; and (2) serves as the basis for the extension of credit, in the case of a real estate transaction involving the making, refinancing, or consolidation of a mortgage loan. (b) The term may include any of the following: (1) The results of an automated valuation model. (2) A broker’s price opinion. (3) A desktop evaluation.As added by P.L.52-2009, SEC.2.Administrative Code § 876-3-2-3Types of real estate transactions not governed by federal law (b) Nothing about this article shall be construed to limit the right of licensed real estate brokers to conduct appraisals of real estate except to the extent federal law requires that they be conducted by individuals who hold Indiana licensed residential appraiser licenses, Indiana certified general appraiser licenses, or Indiana certified general appraiser licenses issued by the board.   12  
  • 13. IowaBroadly Permissible: allows non-appraisers to provideappraisals or analyses unless otherwise prohibited by federal orstate law, rule or policy.Iowa Code § 543DAs used in this chapter, unless the context otherwise requires:1. “Appraisal” or “real estate appraisal” means an analysis, opinion or conclusion relating to the nature, quality, value, or utility of specified interests in, or aspects of, identified real estate. An appraisal may be classified by subject matter into either a valuation or an analysis. A “valuation” is an estimate of the value of real estate or real property. An “analysis” is a study of real estate or real property other than estimating value.Purposes.1. The purpose of this chapter is to establish standards for real estate appraisals and a procedure for the voluntary certification of real estate appraisers and the mandatory registration of associate real estate appraisers.2. A person who is not a certified real estate appraiser under this chapter may appraise real estate for compensation if certification is not required by this chapter or by federal or state law, rule, or policy. KansasBroadly permissible: allows real estate brokers andsalespeople to render broker price opinions/CMAs for thirdparties if they do not hold themselves out as appraisers and donot call the opinions appraisals.Kansas Statutes § 58-4103Certification or licensure, when required; temporary certification or licensure; penalty forviolations; exemptions. (a) Except as provided in subsection (b), no person, other than a state certified or licensed appraiser, shall: (1) Engage in any written appraisal in connection with a real estate financial transaction;..   13  
  • 14. (f) The provisions of paragraph (1) of subsection (a) shall not preclude an individual licensed as a real estate broker or salesperson pursuant to K.S.A. 58-3034 et seq., and amendments thereto, from performing and providing a comparative market analysis or broker’s price opinion to a customer, client or third party for compensation in the ordinary course of business. In no event shall such comparative market analysis or broker’s price opinion be referred to as an appraisal nor shall such individual represent such individual’s self as a certified or licensed appraiser under this act unless such person is a state certified or licensed appraiser.Kansas Statutes § 58-4102 Definitions.As used in this act:(a) “Appraisal or “real estate appraisal” means an analysis, opinion or conclusion prepared by a real estate appraiser relating to the nature, quality, value, or utility of specified interests in, or aspects of, identified real estate. An appraisal may be classified by subject matter into either a valuation or an analysis. A valuation is an estimate of the value of real estate or real property. An analysis is a study of real estate or real property other than estimating value.(b) “Broker’s price opinion” and “comparative market analysis” means an analysis, opinion or conclusion prepared by an individual licensed as a real estate broker or salesperson pursuant to K.S.A. 58-3034 et seq., and amendments thereto, relating to the price of specified interests in or aspects of identified real estate property that is provided to a potential customer, client or third party in the ordinary course of business. KentuckyBroadly permissible: does not prohibit real estate licenseesfrom rendering broker price opinions if they do not holdthemselves out as appraisers and do not call the opinionsappraisals.Kentucky Revised Statutes § 324A.030 (1) It shall be unlawful, unless certified or licensed by the board, for any person to: (a) Assume or use any title, designation, or abbreviation likely to create the impression that he or she holds a license or certificate issued by the board; (b) Describe or refer to any appraisal or evaluation of real estate by the term, “state certified,” “state licensed,” or words of substantially similar meaning; or (c) Assume or use any title, designation or abbreviation likely to create the impression of certification or licensure by the state as a real estate appraiser   14  
  • 15. firm, partnership, or corporation. LouisianaBroadly permissible: allows real estate brokers andsalespeople to render broker price opinions/CMAs if they donot hold themselves out as appraisers.Louisiana Revised Statutes§ 37:3993C. It shall be unlawful for an individual, for a fee or other valuable consideration, or with the intention or expectation of receiving or collecting a fee or other valuable consideration from another, to do any of the following unless the individual is licensed under this chapter: (1) Be employed to perform or perform an appraisal as defined in this Chapter... (2) Present himself, or allow himself to be presented, as being able to perform an appraisal for which a license is required under this chapter...E. Nothing in this Chapter shall preclude a licensed real estate broker or salesperson from performing a broker price opinion/comparative market analysis in the ordinary course of the practice of real estate, provided that the broker or salesperson does not represent himself as being a state licensed real estate appraiser.§ 37:3992 (5) “Broker price opinion/comparative market analysis” means an analysis of recent sales of similar properties by a real estate salesperson or broker to derive an indication of the probable sales price of a particular piece of property for the salesperson’s principal.   15  
  • 16. MaineBroadly Permissible: allows real estate brokers and associatebrokers to render broker price opinions with the appropriatedisclaimer, except where federal law requires an appraisal.Maine Revised Statutes –Title 32 § 14004ExemptionReal estate appraisal activity does not include: (2) appraisals or opinions of market value prepared by associate brokers or brokers who maintain active licenses pursuant to chapter 114 rendered for purposes other than for federally related transactions.Any opinion or appraisal of market value rendered under this section must contain thefollowing language in bold print in a prominent location:“This opinion or appraisal was prepared solely for the client, for the purpose and functionstated in this report and is not intended for subsequent use. It was not prepared by alicensed or certified appraiser and may not comply with appraisal standards of theuniform standards of professional appraisal practice.” MarylandBroadly permissible: allows real estate brokers andsalespersons to give an opinion to a third party as to therecommended listing price of real estate, provided it is notreferred to as an appraisal.Maryland Business & Occupations Article 16-101 (3) “Appraisal” does not include an opinion to a potential seller or third party by a person licensed under Title 17 of this article about the recommended listing price or recommended purchase price of real estate, provided that the opinion is not referred to as an appraisal.   16  
  • 17. MassachusettsBroadly Permissible: allows real estate brokers andsalespersons to render broker price opinions as long as thelicensee does not hold him/herself out as an appraiser, exceptwhere federal law requires an appraisal.Massachusetts Chapter 112 Section 174 A. No person, other than a state-certified general real estate appraiser, state- certified residential real estate appraiser or state-licensed real estate appraiser, shall assume or use that respective title or any title, designation, or abbreviation likely to create the impression of certification or licensing as a real estate appraiser by the commonwealth. A person who is not state-certified or state- licensed shall not describe or refer to any appraisal or other evaluation of real estate located in the commonwealth by the term “certified”; provided, however, that this shall not preclude a person who is not certified as a state-certified general real estate appraiser, state-certified residential real estate appraiser or state-licensed real estate appraiser from appraising real estate in connection with non-federally related transactions for compensation. B. The provisions of sections one hundred and seventy-three to one hundred and ninety- nine, inclusive, shall not apply to a real estate broker or salesperson or to a certified public accountant or business broker who, in the ordinary course of business, gives an opinion of the price of real estate for the purpose of a prospective listing, purchase, sale, or business valuation, provided, however, that such opinion of the price shall not be referred to as an appraisal. C. The certification and licensing provisions of this chapter shall not apply to transactions exempted from the requirements of Title XI.   17  
  • 18. MichiganBroadly permissible: allows real estate brokers and associatebrokers to render broker price opinions/CMAs with theappropriate disclosures, except where federal law requires anappraisal.MCLS § 339.2601 (a) “Appraisal” means an opinion, conclusion, or analysis relating to the value of real property but does not include any of the following: (i) A market analysis performed by a person licensed under article 25 solely for the purpose of assisting a customer or potential customer in determining the potential sale, purchase, or listing price of real property or the rental rate of real property as long as a fee or any other valuable consideration is not charged for that analysis. (ii) A market analysis of real property for a fee performed by a broker or associate broker licensed under article 25 which does not involve a federally related transaction if the market analysis is put in writing and states in boldface print “This is a market analysis, not an appraisal and was prepared by a licensed real estate broker or associate broker, not a licensed appraiser.”   18  
  • 19. MinnesotaBroadly Permissible: allows real estate brokers and salespeopleto perform a broker price opinion except as the primary basisfor a loan origination decision for a consumer’s principalresidence.Effective August 1, 2011.BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:Section 1. Minnesota Statutes 2010, section 82.55, is amended by adding a subdivision toread:Subd. 1a. Automated valuation model. For purposes of this chapter, "automatedvaluation model" means a computerized model used by mortgage originators andsecondary market issuers to determine the collateral worth of a mortgage secured, or tobe secured, by a consumers principal dwelling.EFFECTIVE DATE. This section is effective August 1, 2011.Sec. 2. Minnesota Statutes 2010, section 82.55, is amended by adding a subdivision toread:Subd. 1b. Broker price opinion or BPO. For purposes of this chapter, "broker price opinion"or "BPO" means an estimate prepared by a real estate broker, real estate salesperson, orlicensed real estate appraiser that details the probable selling price of a particular parcelof real property and provides a varying level of detail about the propertys condition,market, and neighborhood, and information on comparable sales, but does not includean automated valuation model.EFFECTIVE DATE. This section is effective August 1, 2011.Sec. 3. [82.735] BROKER PRICE OPINION: REQUIREMENTS; DUTIES OF LICENSEE;REGULATIONS.Subdivision 1. Requirements. A person licensed under this chapter or chapter 82B mayprepare and provide a broker price opinion and may charge and collect a fee for it ifthe license of that licensee is active and in good standing.Subd. 2. Duties of licensee. Notwithstanding any provision of the laws of this state to thecontrary, a person licensed under this chapter or chapter 82B may prepare a brokerprice opinion for:(1) an existing or potential seller for the purposes of listing and selling a parcel of realproperty;   19  
  • 20. (2) an existing or potential buyer of a parcel of real property;(3) a third party making decisions or performing due diligence related to the potentiallisting, offering, sale, exchange, option, lease, or acquisition price of a parcel of realproperty when prepared as required by subdivision 3; or(4) an existing or potential lienholder or other third party for any purpose other than asthe primary basis to determine the value of a piece of property for the purpose of a loanorigination of a residential mortgage loan secured by such piece of property, whendone in conjunction with the purchase of a consumers principal dwelling, whenprepared as required by subdivision 3.Subd. 3. Written report; requirement. (a) Unless the party requesting the opinion requires aspecific report, a broker price opinion prepared for a party under subdivision 2, clause (3)or (4), must be in writing and contain the following:(1) a statement of the intended purpose of the broker price opinion;(2) a brief description of the subject property and property interest to be priced;(3) the basis of reasoning used to reach the opinion on the price, including theapplicable market data;(4) any assumptions or limiting conditions;(5) a disclosure of any existing or contemplated interest of the broker or salespersonissuing the opinion;(6) the name of the broker or salesperson issuing the price opinion;(7) the name of the real estate brokerage that the broker or salesperson is acting onbehalf of;(8) the date of the price opinion; and(9) a disclaimer stating, "This opinion is not an appraisal of the market value of theproperty, and may not be used in lieu of an appraisal. If an appraisal is desired, theservices of a licensed or certified appraiser must be obtained."(b) A copy of the broker price opinion report required under this subdivision together withany supporting materials and documents used in its preparation shall be retained asrequired under section 82.72, subdivisions 3 and 4.(c) A licensee may produce or transmit a broker price opinion report electronically toany person entitled to receive it.EFFECTIVE DATE. This section is effective August 1, 2011.Sec. 5. Minnesota Statutes 2010, section 82B.021, subdivision 19, is amended to read:   20  
  • 21. Subd. 19. Market analysis; broker price opinion. "Market analysis" or "broker price opinion"means a price opinion prepared by a licensed real estate salesperson, broker, or realestate appraiser in accordance with section 82.735.EFFECTIVE DATE. This section is effective August 1, 2011.Sec. 6. Minnesota Statutes 2010, section 82B.035, is amended by adding a subdivision toread:Subd. 1a. Broker price opinion. (a) This chapter does not apply to a licensed real estatesalesperson, broker, or real estate appraiser who prepares a broker price opinion inaccordance with section 82.735. In connection with the purchase of a consumersprincipal dwelling, a broker price opinion may not be used as the primary basis todetermine the value of a parcel of property for the purpose of a loan origination of aresidential mortgage loan secured by the parcel of property.(b) An appraiser preparing a broker price opinion shall disclose that the appraiser is notacting as an appraiser in preparing the broker price opinion and that the broker priceopinion is not an appraisal or appraisal assignment and, therefore, is not subject toUSPAP.EFFECTIVE DATE. This section is effective August 1, 2011.   MississippiBroadly permissive. Allows real estate brokers andsalespersons to render broker price opinions except as theprimary basis for loan originations. Effective July 1, 2011.Section 73-35-4, Mississippi Code of 1972SECTION 2. (6) The term “broker price opinion” means an estimate prepared by a real estate broker, agent, or salesperson that details the probable selling price of a particular piece of real estate property and provides a varying level of detail about the property’s condition, market, and neighborhood, and information on comparable sales, but does not include an automated valuation model.SECTION 3. (1) A person licensed under this chapter may prepare a brokers price opinion and charge and collect a fee for such opinion if:   21  
  • 22. (a) The license of that licensee is active and in good standing; and (b) The brokers price opinion meets the requirements of subsections (3) and (4) of this section. (2) Notwithstanding any provision to the contrary, a person licensed under this chapter may prepare a brokers price opinion for: (a) An existing or potential seller for the purposes of listing and selling a parcel of real property, (b) An existing or potential buyer of a parcel of real property, (c) A third party making decisions or performing due related to the potential listing, offering, sale, option, lease or acquisition price of a parcel of real property, (d) An existing or potential lienholder or other third for any purpose other than as the basis to determine the value of a parcel of property, for a mortgage loan origination, including first and second mortgages, refinances, or equity lines of credit. (e) The provisions of this subsection do not preclude the preparation of a brokers price opinion to be used in conjunction with or in addition to an appraisal. (3) A broker’s price opinion prepared under the authority granted in this act shall be in writing and shall conform to the standards and guidelines published by a nationally recognized association of providers of broker price opinions. The Mississippi Real Estate Commission shall promulgate regulations that are consistent with, but not limited to, the standards and guidelines of a nationally recognized provider of broker price opinions. (4) A broker’s price opinion shall be in writing and contain the following: (a) A statement of the intended purpose of the broker’s price opinion; (b) A brief description of the subject property and property interest to be priced; (c) The basis of reasoning used to reach the conclusion of the price, including the applicable market data and/or capitalization computation; (d) Any assumptions or limiting conditions; (e) A disclosure of any existing or contemplated interest of the broker or salesperson issuing the opinion; (f) The effective date of the price opinion; (g) The name and signature of the broker or salesperson issuing the price opinion; (h) The name of the real estate brokerage firm for which the broker or salesperson is acting;   22  
  • 23. (i) The signature date; (j) A disclaimer stating that, “This opinion is not an appraisal of the market value of the property, and may not be used in lieu of an appraisal. If an appraisal is desired, the services of a licensed or certified appraiser must be obtained. This opinion may not be used by any party as the primary basis to determine the value of a parcel of real property for a mortgage loan origination, including first and second mortgages, refinances or equity lines of credit.”; and (k) A certification that the licensee is covered by errors and omissions insurance, to the extent required by state law, for all liability associated with the preparation of the broker’s price opinion.(5) If a broker’s price opinion is submitted electronically or on a form supplied by the requesting party: (a) A signature required by paragraph (g) of subsection (4) may be an electronic signature, as defined in Section 75-12-3. (b) A signature required by paragraph (g) of subsection (4) and the disclaimer required by paragraph (j) of subsection (4) may be transmitted in a separate attachment if the electronic format or form supplied by the requesting party does not allow additional comments to be written by the licensee. The electronic format or form supplied by the requesting party must: (i) Reference the existence of a separate attachment; and (ii) Include a statement that the broker’s price is not complete without the attachment. (6) Notwithstanding any provisions to the contrary, a person licensed pursuant to this chapter may not prepare a broker’s price opinion for any purpose in lieu of an appraisal when an appraisal is required by federal or state statute. A broker’s price opinion which estimates value or worth a parcel of real estate rather than sales price shall be deemed to be an appraisal and may not be prepared by a licensed broker or sales agent under the authority of their licensee but may only be prepared by a duly licensed appraiser and must meet the regulations promulgated by the Mississippi Real Estate Appraiser Licensing and Certification Board. A broker’s price opinion may not under any circumstances be referred to as a valuation or appraisal.SECTION 4. This act shall take effect and be in force from and after July 1, 2011.   23  
  • 24. MissouriBroadly permissible: allows real estate brokers andsalespersons to render BPOs/CMAs as long as they do not holdthemselves out as appraisers and do not call the BPO/CMA anappraisal.Missouri Revised Statutes§ 339.501.5The provisions of sections 339.500 to 339.549 [appraiser licensing] shall not be construedto require a license or certificate for: (4) Any licensed real estate broker or salesperson who prepares a comparative market analysis or broker price opinion; ...§ 339.503(8) “Broker price opinion”, an opinion of value, prepared by a real estate licensee for a fee, that includes, but is not limited to, analysis of competing properties, comparable sold properties, recommended repairs and costs or suggested marketing techniques. A broker price opinion is not an appraisal and shall specifically state it is not an appraisal; ...(13) “Comparative market analysis”, the analysis of sales of similar recently sold properties in order to derive an indication of the probable sales price of a particular property undertaken by a licensed real estate broker or agent, for his or her principal. A comparative market analysis is not an appraisal and shall specifically state that it is not an appraisal…   24  
  • 25. MontanaBroadly permissible: allows non-appraisers to appraise realestate if they do not hold themselves out as appraisers exceptwhere federal law requires an appraisal.Montana Code Annotated § 37-54-201Real estate appraiser license – scope and display of license. (5) This chapter does not preclude a person who is not a licensed or certified real estate appraiser from appraising real property for transaction not related to a federal agency or project for compensation if the person does not purport to be a licensed or certified appraiser. A person who purports that the person or the person’s company is licensed under this 37-54-302 and 37-54-303 without possessing the applicable license or certificate is guilty of a misdemeanor. NebraskaBroadly Permissible: allows real estate brokers and salespeopleto render broker price opinions/CMAs except as the sole basisfor a loan origination decision, as long as the opinion is notreferred to as an appraisal and the appropriate disclaimer isgiven. (Effective 2010)§ 76-2221Act; exemptions. The Real Property Appraiser Act shall not apply to: (2) A person referred to in subsection (1) of section 81-885.16.§ 81-885.16Real Property Appraiser Act; applicability; broker’s price opinion or comparative marketanalysis; requirements. (1) The Real Property Appraiser Act shall not apply to a person licensed under the Nebraska Real Estate License Act who, in the ordinary course of his or her business, gives a broker’s price opinion or comparative market analysis, except that such opinion or analysis shall not be referred to as an appraisal.   25  
  • 26. (2) No compensation, fee or other consideration shall be charged for a broker’s price opinion or comparative market analysis other than a real estate commission or brokerage fee charged or paid for brokerage services rendered in connection with the sale of real estate involved unless the opinion or analysis is in writing, is signed by the preparer, includes the date on which it was prepared and contains or has attached thereto the following disclosure in bold fourteen-point type: This opinion or analysis is not an appraisal. It is intended only for the benefit of the addressee for the purpose of assisting buyers or sellers or prospective buyers or sellers in deciding the listing, offering or sale price of the real property or for lending purposes in a transaction other than a federally related transaction. This opinion or analysis is not governed by the Real Property Appraiser Act. (3) A broker’s price opinion or comparative market analysis prepared for an existing or potential lienholder originating, extending, renewing, or modifying a loan in a transaction other than a federally related transaction may not be used as the sole basis to determine the value of real estate for the purpose of originating a loan secured by such real estate, and the person giving the opinion or analysis must be engaged directly by the lienholder or its agent. Such person shall have no duty to inquire as to any other basis used to determine such value. NevadaBroadly Permissible: allows real estate brokers and salespeopleto render broker price opinions/CMAs except in lieu of anappraisal for a loan origination approval. (Effective 2009)Nevada Revised Statutes § 645.2515Broker’s price opinion: Requirements; duties of licensee; regulations. (2) A person licensed pursuant to this chapter [real estate licensing] may prepare a broker’s price opinion for: (a) An existing or potential seller for the purposes of listing and selling a parcel of real property; (a) An existing or potential buyer of a parcel of real property; (c) A third party making decisions or performing due diligence related to the potential listing, offering, sale, exchange, option, lease or acquisition price of a parcel of real property; or (d) An existing or potential lienholder, except that a broker’s price opinion prepared for an existing or potential lienholder may not be used in lieu of an appraisal for the purpose of determining whether to approve a mortgage loan.   26  
  • 27. (3) A broker’s price opinion must include, without limitation:              (a) A  statement of the intended purpose of the broker’s price opinion; (b) A brief description of the real property and the interest in the real property for which the broker’s price opinion is being prepared; (c) The basis used to determine the broker’s price opinion, including, without limitation, any applicable market data and the computation of capitalization; (d) Any assumptions or limiting conditions used to determine the broker’s price opinion; (e) The date of issuance of the broker’s price opinion; (f) A disclosure of any existing or contemplated interest of every licensee who prepares or provides the broker’s price opinion, including, without limitation, the possibility of a licensee representing the seller or purchaser; (g) The license number, name and signature of every licensee who prepares or provides the broker’s price opinion; (h) If a licensee who prepares or provides the broker’s price opinion is a real estate salesman or a real estate broker-salesman, the name of the real estate broker with whom the licensee is associated; and (i) In at least 14-point bold type, the following disclaimer: Notwithstanding any preprinted language to the contrary, this opinion is not an appraisal of the market value of the property. If an appraisal is desired, the services of a licensed or certified appraiser must be obtained.(4) If a broker’s price opinion is submitted electronically or on a form supplied by the requesting party: (a) A signature required by paragraph (g) of subsection 3 may be an electronic signature, as defined by NRS 719.100. (b) A signature required by paragraph (g) of subsection 3 and the disclaimer required by paragraph (i) of subsection 3 may be transmitted in a separate attachment if the electronic format or form supplied by the requesting party does not allow additional comments to be written by the licensee. The electronic format or the form supplied by the requesting party must: (1) Reference the existence of a separate attachment; and (2) Include a statement that the broker’s price opinion is not complete without the attachment. (5) A broker’s price opinion that is submitted electronically is subject to any regulations relating to recordkeeping as adopted pursuant to this chapter. (6) A broker is responsible for all activities of a licensee who is associated with the broker and with the preparation of a broker’s price opinion. (7) The Commission may adopt regulations prescribing the manner in which a broker’s price opinion must be prepared in accordance with the provisions of this section. (8) As used in this section, “broker’s price opinion” means a written analysis, opinion or conclusion that a person licensed pursuant to this chapter prepares for a person described in subsection 2 relating to the estimated price for a specified parcel of real property.   27  
  • 28. New HampshireBroadly permissible: allows real estate licensees to renderbroker price opinions/CMAs, as long as they do not callthemselves appraisers, except where federal law requires anappraisal.New Hampshire Statutes § 310-B:3Licensure and Certification Use.I. No person, other than a certified or licensed real estate appraiser, shall assume that title or any title, designation, or abbreviation likely to create the impression of certification or licensure as real estate appraiser by this state. A person who is not certified or licensed pursuant to this chapter shall not describe or refer to any appraisal or other evaluation of real estate located in this state by the term “certified” or “licensed”.II. Paragraph I shall not preclude a person who is not certified or licensed as a real estate appraiser from appraising real estate for non-federally related transactions.IV. The provisions of this chapter shall not apply to a real estate licensee under RSA 331- A when performing comparative market analyses or broker price opinions pursuant to permitted activities regulated by the New Hampshire real estate commission. New JerseyBroadly permissible: allows real estate brokers andsalespersons to render broker price opinions/CMAs for the useof state or federally chartered banks except where federal lawrequires an appraisal.New Jersey Statutes § 45:14F-21c. Except as otherwise provided in subsection f. of this section, no person other than a State licensed real estate appraiser, a State certified real estate appraiser or a person who assists in the preparation of an appraisal under the direct supervision of a State licensed or certified appraiser shall perform or offer to perform an appraisal assignment in regard to any real estate located in this State...Nothing in P.L.1991, c.68 (C.45:14F-1 et seq.) shall be construed to preclude a person notlicensed or certified pursuant to this act from giving or offering to give, for a fee orotherwise, counsel and advice on pricing, listing, selling and use of real property, directly   28  
  • 29. to a property owner or prospective purchaser if the intended use of the counsel oradvice is solely for the individual knowledge of or use by the property owner orprospective purchaser.f. A State or federally chartered bank, savings bank or savings and loan association may obtain and use appraisals made by a person who is not certified or licensed pursuant to the provisions of P.L.1991, c68 (C.45.14F-1 et seq.) in any circumstance where the underlying transaction is a federally related transaction for which federal law and regulation do not require that a certified or licensed appraiser be used. For the purposes of this subsection, “federal law” means Title XI of Pub.L. 101-73(12 U.S.C. s.3331 et seq.); and “federally related transaction” has the meaning as set forth in section 1121 of Title XI of Pub.L. 101-73 (12 U.S.C. s.3350). New MexicoSafe Harbor for Listings: exempts real estate brokers andsalespeople from appraiser licensing requirement in brokeragecontext or for marketing analyses, as long as they do not getpaid any compensation.New Mexico Statutes § 61-30-10F. The requirement of registration, licensing or certification shall not apply to a real estate broker or salesperson who, in the ordinary course of business, gives an opinion of the price or value of real estate for the purpose of securing a listing, marketing of real property, affecting a sale, lease or exchange, conducting market analyses or rendering specialized services; provided, however, this opinion of the price or value shall not be referred to or construed as an appraisal or appraisal report and no compensation, fee or other consideration is expected or charged for such opinion, other than the real estate brokerage commission or fee for services rendered in connection with the identified real estate or real property. New YorkBroadly Permissible: allows non-appraisers to appraise realproperty for compensation.New York Executive Law § 160-b2Nothing in this article shall preclude a person who is not a state certified or licensed realestate appraiser or a licensed real estate appraiser assistant from appraising real estatefor compensation.   29  
  • 30. North CarolinaSafe Harbor for Listings: exempts real estate brokers fromappraiser licensing requirement to perform CMAs in brokeragecontext and where there is a reasonable anticipation of alisting, as long as they do not represent themselves asappraisers.Regulatory guidance: the North Carolina Appraisers’ Board hasissued guidance stating that it interprets the statute to permitCMAs only where there is a reasonable anticipation of a listing.See North Carolina Appraisal Board “Appraisereport”, February2011.General Statutes§ 93E-1-3 (b) Nothing in this Chapter shall preclude a real estate broker licensed under Chapter 93A of the General Statutes from performing a comparative market analysis as defined in G.S. 93E-1-4, provided the person does not represent himself or herself as being a registered trainee or a licensed or certified real estate appraiser. A real estate broker may perform a comparative market analysis for compensation or other valuable consideration only for prospective or actual brokerage clients or for real property involved in an employee relocation program.§ 93E-1-4 (7c) ”Comparative market analysis” means the analysis of sales of similar recently sold properties in order to derive an indication of the probable sales price of a particular property by a licensed real estate broker.   30  
  • 31. North DakotaBroadly permissible: allows real estate brokers andsalespersons to give an opinion to a third party as to therecommended listing price of real estate, provided it is notreferred to as an appraisal.North Dakota Century Code § 43-23.3-04 This chapter [appraiser licensing] does not apply to a licensed real estate broker or salesperson who, in the ordinary course of 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. However, the opinion as to the listing price or the purchase price may not be referred to as an appraisal. This chapter does not apply to a person who, in the ordinary course of business, gives an opinion of the value of real estate to that persons employer. OhioBroadly permissible: no restrictions placed on real estatebrokers or salespersons rendering broker price opinions. If abroker price opinion is to be used for a loan application, acopy of the report must be given to the consumer and theappropriate disclaimer made.Ohio Revised Code §4763.19 (A) Subject to division (B) of this section, no person shall perform a real estate appraisal for a mortgage loan if the person is not licensed or certified under this chapter to do the appraisal. (B) Division (A) of this section does not apply to a lender using a market analysis or price opinion, an internal valuation analysis, or an automated valuation model or report based on an automated valuation model, and any person providing that report to the lender, in performing a valuation for purposes of a loan application, as long as the lender does both of the following: (1) Gives the consumer loan applicant a copy of any written market analysis or price opinion or valuation report based on an automated valuation model; (2) Includes a disclaimer on the consumer’s copy specifying that the valuation used for the purposes of the application was obtained from a market analysis   31  
  • 32. or price opinion or automated valuation model report and not from a person licensed or certified under this chapter. Oklahoma Broadly permissible: no restrictions placed on real estate brokers or salespersons rendering broker price opinions, as long as they do not call themselves appraisers.Oklahoma Statutes § 59-858-702 A. No person, other than a state licensed, state certified residential or state certified general real estate appraiser, shall assume or use that title or any title, designation or abbreviation likely to create the impression of certification as a real estate appraiser by this state. A person who is not certified pursuant to the provisions of the Oklahoma Certified Real Estate Appraisers Act shall not describe or refer to any appraisal or other evaluation of real estate located in this state by using the term “state certified”. B. This Act is hereby deemed to be voluntary on the part of those who apply to become state licensed, state certified residential or state certified general real estate appraisers. Users of appraisals may determine, by their own discretion or by guidelines, whether or not to use a state licensed, state certified residential or state certified general real estate appraiser. OregonBroadly permissible: allows real estate licensees to renderbroker price opinions for the internal use of financial institutions;if used for lending purposes, the transaction must be less than$250,000.Oregon Statutes§ 696.294 (1) As used in this section, “letter opinion” means a document that expresses a real estate licensee’s conclusion regarding a recommended listing, selling or purchase price or a rental or lease consideration of certain real estate and that results from the licensee’s competitive market analysis. (2) The Real Estate Commissioner by rule shall specify the minimum contents of a letter opinion, including but not limited to the distinction between a letter opinion and a real estate appraisal.   32  
  • 33. § 696.301Grounds for discipline. Subject to ORS 696.396, the Real Estate Commissioner maysuspend or revoke the real estate license of any real estate licensee, reprimand anylicensee or deny the issuance of a license to an applicant who has done any of thefollowing:(8) Accepted employment or compensation for the preparation of a competitive marketanalysis or letter opinion that is contingent upon reporting a predetermined value or forreal estate in which the licensee has an undisclosed interest.Oregon Administrative Rule # 863-015-0190Competitive Market Analyses; Letter Opinions; Lending Collateral Analysis; DefaultCollateral Analysis (1) Real estate licensees may provide competitive market analyses and letter opinions in the normal course of their business when they are giving an opinion in pursuit of a listing, to assist a potential buyer in formulating an offer, or to provide a broker’s price opinion, whether or not done for a fee. (2) The term “value” as used in a competitive market analysis or letter opinion is the estimated worth of the property and is not intended to mean or imply the “value” was arrived at by any method of appraisal.... (4) Real estate licensees can provide a “lending collateral analysis” or “default collateral analysis,” if the analysis is used only for the internal purposes of a financial institution and, in the case of a “lending collateral analysis,” that any loan transaction at issue is less than $250,000.“Lending collateral analysis” means a real property market analysis where the purposeof the analysis is for use by the lending institution in support of a loan application.“Default collateral analysis” means a real property analysis where the purpose of theanalysis is for use by a lending institution in considering its actions with respect to a loan indefault. (6) If a real estate broker completes a lending collateral analysis or a default collateral analysis on a property in which the real estate broker or principal real estate broker has either a current, active listing agreement or is representing the buyer or seller in a pending transaction, the real estate broker must disclose to the buyer and seller the real estate broker’ relationships with the lending institution.   33  
  • 34. PennsylvaniaSafe Harbor for Listings: exempts real estate agents fromappraiser licensing requirement to perform CMAs in brokeragecontext and where there is a reasonable anticipation of alisting. Appropriate disclosures must be made.Regulatory Guidance: The Real Estate Commission has statedthat it interprets the statute to allow real estate licensees torender CMAs (not BPOs) only to obtain a listing.049 Pennsylvania Consolidated Statutes§ 35.201DefinitionsComparative Market Analysis – A written analysis, opinion or conclusion by a contractedbuyer’s agent, transactional licensee or an actual or potential seller’s agent relating tothe probable sale price of a specified piece of real estate in an identified real estatemarket at specified time, offered either for the purpose of determining theasking/offering price for the property by a specific or actual consumer or for the purposeof securing a listing agreement with a seller.§ 35.340A comparative market analysis shall contain the following statement printedconspicuously and without change on the first page:This analysis has not been performed in accordance with the Uniform Standards ofProfessional Appraisal Practice which requires valuers to act as unbiased, disinterestedthird parties with impartiality, objectivity and independence and withoutaccommodation of personal interest. It is not to be construed as an appraisal and maynot be used as such for any purpose.   34  
  • 35. Rhode IslandSafe Harbor for Listings: exempts real licensees from appraiserlicensing requirement in brokerage context.Rhode Island § 5-20.7-3(b) This chapter precludes any person who is not certified as a state certified real estate appraiser from appraising real property for compensation under chapter 20.5 of this title; provided, however, that this chapter does not preclude any person who holds a license pursuant to chapter 20.5 of this title and, in the ordinary course of business, from giving a written or oral opinion of value of real estate for the purposes of a prospective listing, purchase, sale, or business valuation; provided, however, that such opinion of value shall not be referred to as an appraisal. South CarolinaBroadly Permissible: allows real estate licensees to render aprice opinion if it is not referred to as an appraisal anddisclosures are made to the requesting party that the opinioncannot be used for obtaining financing where federal lawprohibits the opinion’s use.South Carolina Code Annotated § 40-60-30It is unlawful for an individual to assume or use a title, designation, or abbreviation likelyto create the impression that the person is a real estate appraiser or to engage inappraisal activity or advertise as an appraiser without a valid license issued by thedepartment. However, nothing in this chapter may be construed to apply to: (1) A real estate licensee licensed in accordance with Chapter 57 of Title 40 who performs a market analysis or gives an opinion as to the price of real estate on the condition that the market analysis or opinion is not referred to as an appraisal. Before performing a market analysis, the real estate licensee must disclose to the requesting party: “This market analysis may not be used for the purposes of obtaining financing in a federally-related transaction.”   35  
  • 36. South DakotaBroadly permissible: no prohibitions on real estate brokersperforming broker price opinions.SD Codified Laws§ 36-21 A-6“Real estate broker” and “broker” defined. For the purposes of this chapter, a broker or areal estate broker is any person who does any of the following: (8) Appraises, offers, attempts or agrees to appraise real property unless licensed or certified to appraise under some other provision of South Dakota law...§ 36-21B-2Appraisal for compensation. For the purposes of this chapter, an appraisal is the act orprocess of estimating value of real estate for another and for compensation.§ 36-21B-8Unless required by the Financial Institutions Reform, Recovery, and Enforcement Act of1989, Pub.L. No. 101-73, 103 Stat. 183 (1989)... this chapter does not apply to any of thefollowing: (2) Any person licensed as a real estate broker under chapter 36-21A when appraising within the scope of the broker’s license. TennesseeBroadly permissible: allows a real estate broker or salespersonto render an opinion to a third party as to the recommendedlisting price of real estate, provided it is not referred to as anappraisal, and no opinion is rendered as to value.Tennessee Code Annotated § 62-39-104 (a)This chapter does not apply to a real estate broker or salesperson licensed by this statewho, in the ordinary course of business, gives an opinion to a potential seller or third partyas to the recommended listing price of real estate or an opinion to a potential purchaseror third party as to the recommended purchase price of real estate. This opinion as tothe listing price or the purchase price shall not be referred to as an appraisal and noopinion shall be rendered as to the value of the real estate or real property.   36  
  • 37. TexasBroadly permissible: allows a real estate broker or salespersonto render an opinion to a third party as to the recommendedlisting price of real estate, provided it is not referred to as anappraisal.Texas Occupations Code § 1103.004(c) This chapter does not prohibit: (2) a real estate broker or salesperson licensed under Chapter 1101 but not certified or licensed under this chapter from performing an appraisal in a transaction other than a federally related transaction; ... (3) a real estate broker or salesperson licensed under Chapter 1101 from giving an opinion if the opinion: (A) is not referred to as an appraisal; and (B) is given in the ordinary course of the brokers or salespersons business to: (i) a potential seller or third party regarding the recommended listing price of real property; or (ii) a potential purchaser or third party regarding the recommended purchase price of real property.Rules of the Texas Real Estate Commission § 535.17 (a) A salesperson may make, sign, and present real estate appraisals for the salesperson’s sponsoring broker, but the salesperson must submit appraisals in the brokers name and the broker is responsible for the appraisals. (b) Texas Occupations Code, Chapter 1101 (the Act) does not apply to appraisals performed by the employees of a financial institution or investment firm in connection with a contemplated loan or investment by their employers. (c) Except as provided by this section, appraisals of real property performed in this state by Texas real estate licensees must be conducted in accordance with the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation in effect at the time the appraisal is performed. If a real estate licensee, for a separate fee, provides an opinion of value or comparative market analysis which does not conform with the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation, the licensee shall also provide the person for whom the opinion or analysis is prepared with a written statement containing the following   37  
  • 38. language: "THIS IS AN OPINION OF VALUE OR COMPARATIVE MARKET ANALYSIS AND SHOULD NOT BE CONSIDERED AN APPRAISAL. In making any decision that relies upon my work, you should know that I have not followed the guidelines for development of an appraisal or analysis contained in the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation." (d) The statement required by subsection (c) of this section must be made part of any written opinion or analysis report and must be reproduced verbatim. UtahBroadly permissible: allows real estate brokers and agents togive an opinion to a third party as to the recommended listingprice of real estate, provided it is not referred to as anappraisal.Utah Code 61-2b-3 (1) Except as provided in Subsection (2) ... it is unlawful for anyone to prepare, for valuable consideration, an appraisal, an appraisal report, a certified appraisal report, or perform a consultation service relating to real estate or real property in this state without first being licensed or certified in accordance with this chapter. (2) This section does not apply to: (a) a real estate broker or sales agent as defined by Section 61-2-2 licensed by this state who, in the ordinary course of the real estate brokers or sales agents business, gives an opinion: (i) regarding the value of real estate; (ii) to a potential seller or third party recommending a listing price of real estate; (iii)to a potential buyer or third party recommending a purchase price of real estate…   38  
  • 39. VermontBroadly Permissible: allows real estate brokers andsalespersons to render a price opinion if it is not referred to asan appraisal and they do not call themselves appraisers,except where federal law requires an appraisal.26 V.S.A. § 3312 Prohibitions; penalty (a) Unless licensed in accordance with the provisions of this chapter, no person may: (1) Perform an appraisal in a federally related transaction when a licensed or certified appraiser is required by the Act. (2) Use in connection with his or her name any letters, words, or insignia indicating that he or she is a state certified or licensed real estate appraiser.26 V.S.A. § 3311 DefinitionsAs used in this chapter: (4) “Appraisal” means an analysis, opinion or conclusion relating to the value of specified interests in or aspects of identified real estate or identified real property. (5) “Appraiser” or “real estate appraiser” means a person licensed under this chapter.   39  
  • 40. VirginiaBroadly Permissible: allows real estate brokers andsalespersons to render a price opinion if it is not referred to asan appraisal, is not used in lieu of an appraisal and they do notcall themselves appraisers, except where an appraisal isrequired by federal law.Regulatory Guidance: The Virginia Real Estate Board has issuedguidance to assist licensees in understanding BPOrequirements. It interprets the statute in the following way: thelicensee cannot represent him/herself as an appraiser; cannotcall the BPO an appraisal; and the BPO cannot be used in lieuof an appraisal when an appraisal is required by federal orstate law. Further, a real estate licensee cannot make a falsestatement or report. Payments for BPOs must be through aprincipal broker, and supervising brokers must exercise propersupervision and may be held liable for any failure to remedyregulatory violations.Va. Code Annotated § 54.1-2010 A. The provisions of this chapter [appraiser licensing] shall not apply to: 1. A real estate broker or salesperson licensed in the Commonwealth who, in the ordinary course of business, provides a valuation or analysis of real estate for a fee; however, such person shall not hold himself out as a real estate appraiser, and the valuation shall not be referred to as an appraisal and shall not be used in lieu of an appraisal performed by a licensed appraiser.   40  
  • 41. WashingtonBroadly Permissible: allows real estate brokers andsalespersons to render a broker price opinion, with anappropriate disclaimer, if it is not referred to as an appraisaland they do not call themselves appraisers, except where anappraisal is required by federal law.Wash. Rev. Code § 18.140.020 (6) This Chapter [appraiser licensing] does not preclude an individual person licensed by the state of Washington as a real estate broker or as a real estate salesperson from issuing a brokers price opinion. However, if the brokers price opinion is written, or given as evidence in any legal proceeding, and is issued to a person who is not a prospective seller, buyer, lessor or lessee as the only intended user, then the brokers price opinion shall contain a statement, in an obvious location within the written document or specifically and affirmatively in spoken testimony, that substantially states: “This brokers price opinion is not an appraisal as defined in chapter 181.140 RCW and has been prepared by a real estate licensee, licensed under chapter 18.85 RCW, who...(is/is not) also state-certified or state-licensed as a real estate appraiser under chapter 18.140 RCW.” However, the broker’s price opinion issued under this subsection may not be used as an appraisal in conjunction with a federally related transaction.   41  
  • 42. West VirginiaPermissible with some limitations: allows real estate brokersand salespersons to render an opinion to a third party as to therecommended listing price of real estate, as long as theopinion is not referred to as an appraisal, and no fee ischarged.Regulatory Guidance: The West Virginia Real EstateCommission has issued an opinion interpreting the statute tostate that real estate licensees may not issue BPOs forcompensation unless they hold an appraiser’s license. SeeLetter dated December 5, 2007 from West Virginia Real EstateCommission.West Virginia Code §30-38-1 c) This article does not apply to: (1) 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.   42  
  • 43. WisconsinBroadly Permissible: allows real estate brokers andsalespersons to render a price opinion if it is not referred to asan appraisal and they do not call themselves appraisers.Wisconsin Statutes§ 458.02Nothing in this chapter shall be construed to prohibit a person who is not a certifiedappraiser or licensed appraiser from appraising real estate or from cosigning anappraisal report with a certified appraiser or licensed appraiser if the person complieswith s. 458.055.§ 458.055Prohibited conduct. Except as provided in s. 458.095, no person may do any of thefollowing: (1) Use the title “Wisconsin certified appraiser”, “Wisconsin certified general appraiser”, “Wisconsin certified residential appraiser” or any similar title unless the person holds an applicable appraiser certificate issued under s. 458.06. (2) Describe or refer to an appraisal of real estate located in this state by the term “Wisconsin certified” or any similar term unless the person holds an applicable appraiser certificate issued under s. 458.06. (3) Use the title “Wisconsin licensed appraiser” or any similar title unless the person is a certified appraiser or licensed appraiser. (4) Describe or refer to an appraisal of real estate located in this state by the term “Wisconsin licensed” or any similar term unless the person is a certified appraiser or licensed appraiser.   43  
  • 44. WyomingSafe Harbor for Listings: exempts real estate brokers andsalespeople from appraiser licensing requirement in brokeragecontext.Wyoming Certified Real Estate Appraiser Board Rules and RegulationsChapter 1, Section 3 (a) These Rules and Regulations shall not apply to a real estate broker, associate broker or salesman who, in the ordinary course of business, gives an opinion of the price of real estate for the purpose of a prospective listing or sale, provided, however, this opinion of price shall not be referred to or construed to be an appraisal.   44