To support recovery efforts following recent wildfires and straight-line wind damage in Los Angeles County, California, four federal financial institutions' regulatory agencies have temporarily suspended certain appraisal requirements for real estate-related transactions.
This measure is intended to enable banks and credit unions to collaborate with affected families and businesses without the need for a formal appraisal. However, these institutions must still ensure that the property's value justifies their decision to proceed with the transaction.
The suspension aims to assist financial institutions in extending or modifying loans in areas where the disaster has made obtaining appraisals difficult. Additionally, it is expected to decrease loan processing times, thereby aiding recovery efforts.
"Financial institutions will be better able to lend or modify loans in areas where wildfire and straight-line wind damage has made appraisals challenging to obtain. This action is also expected to reduce loan processing times, helping to facilitate recovery from the disaster."