Federal law requires that before a financial institution makes a loan on a residential property the lender must obtain an independent appraisal of the property. For residential property, a comparable sales approach is used for the appraisal.
A creditor may not extend credit in the form of a higher-risk mortgage to any consumer without first obtaining a written appraisal of the property to be mortgaged prepared in accordance with the requirements of this section.
Regulation B requires creditors to provide to applicants free copies of all appraisals and other written valuations developed in connection with a loan application and requires creditors to notify applicants in writing that copies of appraisals will be provided to them upon earlier completion and at least three business days before closing
