Under the Dodd-Frank appraisal independence rules, is there a restriction on paying 50% more than the customary charge to enter a new market?

Under the Dodd-Frank appraisal independence rules, is there a restriction on paying 50% more than the customary charge to enter a new market?

• A. Yes, the law dictates that fees be customary and reasonable for the geographic market
• B. No, appraisal companies can negotiate openly for their fees
• C. Yes, the law establishes appraisal fee rates geographically across the country
• D. No, the Dodd-Frank Act allows this for the first year in a new market

Answer: (A)

Under the Dodd-Frank appraisal independence rules, fees for appraisals must be customary and reasonable for the geographic market. Paying a 50% premium just to enter a new market would not align with local market norms and could create pressure or the appearance of influence over the appraisal, which these rules prohibit. There is no provision that allows such a premium for first-year market entry, nor are there nationwide fixed fee rates. So, the correct understanding is that there is a restriction—fees must reflect local market practices, not inflated amounts to gain access to a new market.

Under the Dodd-Frank appraisal independence rules, fees for appraisals must be customary and reasonable for the geographic market. Paying a 50% premium just to enter a new market would not align with local market norms and could create pressure or the appearance of influence over the appraisal, which these rules prohibit. There is no provision that allows such a premium for first-year market entry, nor are there nationwide fixed fee rates. So, the correct understanding is that there is a restriction—fees must reflect local market practices, not inflated amounts to gain access to a new market.