Real estate: appraisal and valuation.

Existing law, the Real Estate Law, provides for the licensure and regulation of real estate brokers and real estate salespersons by the Real Estate Commissioner and makes a willful violation of the act a crime. Existing law authorizes the commissioner to temporarily suspend or permanently revoke a real estate license when the licensee has been guilty of generating an inaccurate opinion of the value of residential real property in connection with a certain real estate transaction in order to, among other things, acquire a financial or business advantage that directly results from the inaccurate opinion of value. This bill would delete that provision and would instead prohibit a licensee from knowingly or intentionally misrepresenting the value of real property. The bill would also prohibit a licensee that offers or provides an opinion of value of residential real property related to the origination of a mortgage loan from having a prohibited interest in the property, as specified under federal law. Existing law, the Real Estate Appraisers' Licensing and Certification Law, provides for the licensure and regulation of real estate appraisers and appraisal management companies and makes a willful violation of the law a crime. Existing law prohibits an appraisal management company from improperly influencing any appraisal by engaging in certain activities. This bill would revise that provision by prohibiting an appraisal management company from improperly influencing any appraisal through coercion, extortion, inducement, collusion, bribery, intimidation, compensation, or instruction. The bill would specifically prohibit certain acts, including, but not limited to, seeking to influence an appraiser to report a minimum or maximum value for specified property, implying to an appraiser that his or her retention depends on his or her estimate of the real property value, excluding an appraiser from future engagement because he or she reported a value that does not meet or exceed a certain threshold, and conditioning compensation paid to an appraiser on consummation of the real estate transaction. The bill would also prohibit a person or entity preparing an appraisal or performing appraisal management functions for certain mortgage loan transactions from having a prohibited interest in the property or the transaction, as specified under federal law, for which the appraisal or functions are performed. Existing law prohibits a person with an interest in a real estate transaction involving an appraisal from improperly influencing or attempting to improperly influence, through coercion, extortion, or bribery, the development, reporting, result, or review of a real estate appraisal sought in connection with a mortgage loan, and specifies that a violation of this provision by a person licensed under a state licensing law also constitutes a violation of that law. This bill would instead make that provision applicable to a valuation and would define a valuation as an estimate of the value of real property in written or electronic form, other than one produced solely by an automated model or system. The bill would also enumerate specified prohibited acts under that provision, including, but not limited to, seeking to influence a valuation preparer to report a minimum or maximum value for specified property, implying to a valuation preparer that his or her retention depends on his or her estimate of the real property value, excluding a valuation preparer from future engagement because he or she reported a value that does not meet or exceed a certain threshold, and conditioning compensation paid to a valuation preparer on consummation of the real estate transaction. Because a willful violation of the bill's requirements would be a crime, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.