In a proposal for a rule that would operate in much the same way appraisers are removed from the Department of Housing and Urban Development's (HUD) FHA Appraiser Roster, HUD has published in the Federal Register a means for sanctioning real estate brokers currently authorized to sell FHA repossessed properties. Under the proposal, fraudulent activities, the use of false and misleading statements, the loss of a state license, or acting in concert with an appraiser to arrive at an artificially appraised value would result in removal of the broker's authorization to sell FHA REOs.
Like HUD's means for expunging appraisers, once HUD decides there is cause to remove a broker, it will provide the broker with written notice and the removal takes effect 30 days later. However, brokers will have 20 days after the notice is issued to submit a written response to HUD opposing the proposed removal and to request a conference. The conference will take place within 15 days after HUD receives the request. Within 20 days after the conference, HUD will advise the real estate broker in writing of HUD's decision.
Comments are requested on the proposed rule by November 16. You can see the proposal online HERE
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