21st March 2018

FDIC Board Approves Appraisal Threshold Increase for CRE Transactions

The FDIC board of directors today approved a final rule to raise the appraisal thresholds for commercial real estate transactions from $250,000 to $500,000 — an increase from the original proposal, which called for the appraisal threshold to be raised to $400,000. The threshold for loans secured by 1-to-4 family residential properties will remain at $250,000; however, residential construction loans secured by multiple 1-to-4 residential properties would be considered CRE transactions. The final rule must now be approved by the Federal Reserve and the OCC; once approved by the agencies, it will be effective 30 days after publication in the Federal Register.

ABA has supported an increase to the CRE appraisal threshold, noting in previous comments that doing so would provide immediate relief to banks that are currently struggling with a shortage of certified appraisers — particularly in rural areas — and long appraisal turnaround times. For more information, contact ABA’s Sharon Whitaker.

FDIC Board Approves Appraisal Threshold Increase for CRE Transactions

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