[Federal Register Volume 65, Number 53 (Friday, March 17, 2000)]
[Rules and Regulations]
[Pages 14432-14433]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-6429]


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DEPARTMENT OF AGRICULTURE

Farm Service Agency

7 CFR Parts 761 and 762

RIN 0560-AF69


Streamlining of Regulations for Real Estate and Chattel 
Appraisals; Correction

AGENCY: Farm Service Agency, USDA.

ACTION: Correcting amendments to final rule.

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SUMMARY: This document contains corrections to the final regulations 
which were published in the Federal Register on Wednesday, November 17, 
1999, (64 FR 62566-62569). The final rule removed administrative 
provisions and moved the regulations regarding appraisals pertaining to 
the Farm Service Agency's Farm Loan Programs from Chapter XVIII to 
Chapter VII.

DATE: Effective on March 17, 2000.

FOR FURTHER INFORMATION CONTACT: Chris L. Greenwalt, Senior Loan 
Officer, Program Development and Economic Enhancement Division, USDA/
FSA/PDEED/STOP 0521, 1400 Independence Avenue, S.W., Washington DC 
20250-0521, telephone (202)690-0431, facsimile (202)720-8474, e-mail: 
[email protected].

SUPPLEMENTARY INFORMATION:

Background

    The final regulations that are the subject of these corrections 
removed administrative provisions and clarified the requirement that 
Agency real estate appraisals must comply with the guidelines and 
standards contained in the Uniform Standards of Professional Appraisal 
Practice (USPAP). In addition, the requirement that specific Agency 
formats be used when completing appraisals was eliminated.

Need for Correction

    As published, the final rule (64 FR 62566-62569) contains several 
errors which may prove to be misleading if not corrected. Section 761.7 
is being corrected to clarify that its general requirements apply to 
direct loan appraisals and all appraisal reviews. Guaranteed loan 
appraisals will still be governed by part 762. Section 762.127 is being 
amended accordingly.
    Section 761.7 also needs to be corrected with regards to when an 
existing real estate appraisal will be used. The Agency inadvertently 
failed to address the situation where an appraisal is over 12 months 
old but has been updated by the same appraiser or

[[Page 14433]]

appraisal firm within the previous 12 months in accordance with USPAP. 
In such case, the existing updated real estate appraisal may be used to 
make or service a loan.

List of Subjects

7 CFR Part 761

    Accounting, Accounting servicing, Loan programs--Agriculture, Real 
property--Appraisals, Rural Areas.

7 CFR Part 762

    Agriculture, Loan programs--Agriculture.
    Accordingly, 7 CFR parts 761 and 762 are corrected by making the 
following correcting amendments:

PART 761--GENERAL AND ADMINISTRATIVE

    1. The authority citation for part 761 continues to read as 
follows:

    Authority: 7 U.S.C. 1989.

    2. Revise paragraphs (a) and (d) of Sec. 761.7 to read as follows:


Sec. 761.7  Appraisals

    (a) General. This section describes requirements for:
    (1) real estate and chattel appraisals made in connection with the 
making and servicing of direct Farm Loan Program and nonprogram loans; 
and,
    (2) appraisal reviews conducted on appraisals made in connection 
with the making and servicing of direct and guaranteed Farm Loan 
Program and nonprogram loans.
* * * * *
    (d) Use of an existing real estate appraisal. The Agency may use an 
existing real estate appraisal to reach a loan making or servicing 
decision under either of the following conditions:
    (1) The appraisal was completed within the previous 12 months and 
the Agency determines that:
    (i) The appraisal meets the provisions of this section and the 
applicable Agency loan making or servicing requirements, and
    (ii) Current market values have remained stable since the appraisal 
was completed; or
    (2) The appraisal was not completed in the previous 12 months, but 
has been updated by the appraiser or appraisal firm that completed the 
appraisal, and both the update and original appraisal were completed in 
accordance with USPAP.
* * * * *

PART 762--GUARANTEED FARM LOANS

    4. The authority citation for part 762 continues to read as 
follows:

    Authority: 5 U.S.C. 301; 7 U.S.C. 1989; 42 U.S.C. 1480.
    5. Revise paragraph (d) of Sec. 762.127 by adding the following at 
the end of the introductory text:


Sec. 762.127  Appraisal requirements.

    (d)  *  *  *  Agency officials may accept an appraisal that is not 
current if there have been no significant changes in the market or on 
the subject real estate and the appraisal was either completed within 
the past 12 months or updated by a qualified appraisal if not completed 
within the past 12 months.
* * * * *

    Signed in Washington, D.C., on March 7, 2000.
Parks Shackelford,
Acting Administrator Farm Service Agency.
[FR Doc. 00-6429 Filed 3-16-00; 8:45 am]
BILLING CODE 3410-05-P