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A BILL TO BE ENTITLED
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AN ACT
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relating to the performance of a real property evaluation for use by |
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certain financial institutions. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 1103.003, Occupations Code, is amended |
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by adding Subdivisions (4-b), (6-c), and (7-a) to read as follows: |
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(4-b) "Automated valuation model" means an automated |
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system used to derive the value of real property through publicly |
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available property records and various analytic methodologies, |
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including comparable sales prices, home characteristics, and |
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historical home price appreciations. |
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(6-c) "Federally regulated financial institution" |
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means: |
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(A) a depository institution as defined by |
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Section 3, Federal Deposit Insurance Act (12 U.S.C. Section 1813) |
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or a subsidiary of a depository institution; or |
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(B) a credit union as defined by Section 101, |
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Federal Credit Union Act (12 U.S.C. Section 1752), a subsidiary of a |
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credit union, or a credit union service organization. |
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(7-a) "Non-bank financial institution" means: |
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(A) a residential mortgage loan company licensed |
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under Chapter 156, Finance Code; |
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(B) a mortgage banker regulated under Chapter |
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157, Finance Code; or |
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(C) a regulated lender licensed under Chapter |
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342, Finance Code. |
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SECTION 2. Section 1103.004, Occupations Code, is amended |
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to read as follows: |
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Sec. 1103.004. APPLICABILITY [EFFECT] OF CHAPTER. This |
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chapter does not apply to [prohibit]: |
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(1) a person who is authorized by law to perform [from |
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performing] an evaluation of real property for or to provide |
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[providing] an evaluation of real property to another person; |
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(2) a real estate broker licensed under Chapter 1101 |
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or a sales agent acting under the authority of a sponsoring broker |
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who provides [from providing] to another person a written analysis, |
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opinion, or conclusion relating to the estimated price of real |
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property if the analysis, opinion, or conclusion: |
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(A) is not referred to as an appraisal; |
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(B) is given in the ordinary course of the |
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broker's business; and |
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(C) is related to the actual or potential |
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acquisition, disposition, encumbrance, or management of an |
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interest in real property; [or] |
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(3) an appraiser [who is] certified by a jurisdiction |
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other than this state who performs [from performing] an appraisal |
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review of an appraisal performed on real property in this state, if |
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the appraiser does not offer an opinion of value as part of the |
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appraisal review; |
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(4) an employee of a federally regulated financial |
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institution or any other person engaged by the institution who |
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performs an evaluation of real property for use by the institution |
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in a transaction for which the institution is not required to use |
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the services of a licensed or certified appraiser under federal |
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regulations adopted under Title XI, Financial Institutions Reform, |
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Recovery, and Enforcement Act of 1989 (12 U.S.C. Section 1833e) or |
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under applicable state law; |
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(5) an employee of a non-bank financial institution or |
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any other person engaged by the institution who provides an |
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analysis, assessment, opinion, conclusion, notation, or |
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compilation of data concerning the value of an interest in real |
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property for use by the institution; or |
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(6) the purchase of an automated valuation model. |
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SECTION 3. Section 1103.405, Occupations Code, is amended |
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to read as follows: |
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Sec. 1103.405. PROFESSIONAL STANDARDS. (a) Except as |
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provided by Subsection (b), a [A] person who holds a certificate, |
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license, or registration issued under this chapter shall comply |
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with: |
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(1) the most current edition of the Uniform Standards |
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of Professional Appraisal Practice adopted by the Appraisal |
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Standards Board of the Appraisal Foundation; or |
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(2) other standards provided by board rule that are at |
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least as stringent as the Uniform Standards of Professional |
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Appraisal Practice. |
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(b) A certified or licensed appraiser is not required to |
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comply with the standards described by Subsection (a) to provide: |
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(1) an evaluation of real property described by |
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Section 1103.004(4); or |
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(2) an analysis, assessment, opinion, conclusion, |
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notation, or compilation of data concerning the value of an |
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interest in real property described by Section 1103.004(5) for use |
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by a non-bank financial institution. |
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(c) A document provided under Section 1103.004(4) or (5) |
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must contain on the first page of the document the following notice: |
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"This is not an appraisal performed in accordance with the Uniform |
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Standards of Professional Appraisal Practice." |
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SECTION 4. The changes in law made by this Act apply only to |
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an evaluation, document, or action related to a real property |
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transaction commenced on or after the effective date of this Act. |
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An evaluation, document, or other action related to a real property |
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transaction commenced before the effective date of this Act is |
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governed by the law applicable immediately before the effective |
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date of this Act, and that law is continued in effect for that |
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purpose. |
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SECTION 5. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2021. |