Regulators to publish temporary exceptions to FIRREA appraisal requirement

The Federal Reserve Board, OCC, FDIC, and NCUA have jointly scheduled Federal Register publication tomorrow (March 12, 2024) of temporary exceptions to FIRREA appraisal requirements for real estate-related financial transactions, provided certain criteria are met, in an area in the State of Hawaii following the major disaster declared by President Biden as a result of wildfires. The expiration date for the exceptions is August 10, 2026, which is three years after the date the President declared the major disaster. The agencies' order will be effective on publication.

The agencies also have determined that the exceptions are consistent with safety and soundness, provided that the depository institution determines the following: (1) the transaction involves real property located in the area designated [Maui County] as adversely affected by the major disaster; (2) there is a binding commitment to fund the transaction that was entered into on or after August 10, 2023, but no later than August 10, 2026; and (3) the value of the real property supports the institution’s decision to enter into the transaction. In addition, the transaction must continue to be subject to review by management and by the agencies in the course of examinations of the institution.

• Federal Register document [PDF]
• Federal Register web document