                                 CODE OF VIRGINIA

APPRAISAL MANAGEMENT COMPANIES; LICENSE REQUIRED; POSTING OF BOND OR LETTER OF
CREDIT (§ 54.1-2021.1)

A. No person shall engage in business as an appraisal management company without
a license issued by the Board.

B. The Board may issue a license to do business as an appraisal management
company in the Commonwealth to any applicant who has submitted a complete
application and provides satisfactory evidence that he has successfully:

   1. Completed all requirements established by the Board that are consistent
   with this chapter and are reasonably necessary to implement, administer, and
   enforce the provisions of this chapter; and

   2. Certified to the Board the following information, and such other
   information as may be reasonably required by the Board, regarding the person
   or entity seeking licensure:
   				a. The name of the person or entity;
   				b. The business address of the person or entity;
   				c. Phone contact information for the person or entity, and email address;
   				d. If the entity is not an entity domiciled in the Commonwealth, the name
   and contact information for the entity&#8217;s agent for service of process in
   the Commonwealth;
   				e. If the entity is not an entity domiciled in the Commonwealth, proof
   that the entity is properly and currently registered with the Virginia State
   Corporation Commission;
   				f. The name, address, and contact information for any person or any entity
   that owns 10 percent or more of the appraisal management company;
   				g. The name, address, and contact information for a responsible person for
   the appraisal management company located in the Commonwealth, who shall be a
   person or entity licensed under Chapter 20.1 (&#xA7; 54.1-2009 et seq.);
   				h. That any person or entity that owns any part of the appraisal
   management company has never had a license to act as an appraiser refused,
   denied, canceled, surrendered in lieu of revocation, or revoked by the
   Commonwealth or any other state;
   				i. That the entity has a system in place to review the work of all
   appraisers that may perform appraisal services for the appraisal management
   company on a periodic basis to ensure that the appraisal services are being
   conducted in accordance with the Uniform Standards of Professional Appraisal
   Practice;
   				j. That the entity maintains a detailed record of the following: (i) each
   request for an appraisal service that the appraisal management company
   receives; (ii) the name of each independent appraiser that performs the
   appraisal; (iii) the physical address or legal identification of the subject
   property; (iv) the name of the appraisal management company&#8217;s client for
   the appraisal; (v) the amount paid to the appraiser; and (vi) the amount paid
   to the appraisal management company; and
   				k. That the entity has a system in place to ensure compliance with &#xA7;
   129E of the Truth in Lending Act (15 U.S.C. &#xA7; 1601 et seq.).

C. Any person that owns 10 percent or more of an appraisal management company
and any controlling person of an appraisal management company seeking to be
licensed pursuant to this chapter shall be of good moral character, as
determined by the Board, and shall submit to a background investigation, as
determined by the Board.

D. In addition to the filing fee, each applicant for licensure shall post either
a bond or a letter of credit as follows:

   1. If a bond is posted, the bond shall (i) be in the amount of $100,000 or any
   other amount as set by regulation of the Board, (ii) be in a form prescribed
   by regulation of the Board, and (iii) accrue to the Commonwealth for the
   benefit of (a) a claimant against the licensee to secure the faithful
   performance of the licensee&#8217;s obligations under this chapter or (b) an
   appraiser who has performed an appraisal for the licensee for which the
   appraiser has not been paid. The aggregate liability of the surety shall not
   exceed the principal sum of the bond. A party having a claim against the
   licensee may bring suit directly on the surety bond. When a claimant or an
   appraiser is awarded a final judgment in a court of competent jurisdiction
   against a licensee of this section for the licensee&#8217;s failure to
   faithfully perform its obligations under this chapter or failure to pay an
   appraiser who performed an appraisal, the claimant or the appraiser may file a
   claim with the Board for a directive ordering payment from the bond issuer of
   the amount of the judgment, court costs and reasonable attorney fees as
   awarded by the court. Such claim shall be filed with the Board no later than
   12 months after the judgment becomes final. Upon receipt of the claim against
   the licensee, the Board may cause its own investigation to be conducted. The
   amount of the bond shall be restored by the licensee to the full amount
   required within 15 days after the payment of any claim on the bond. If the
   licensee fails to restore the full amount of the bond, the Board shall
   immediately revoke the license of the licensee whose conduct resulted in
   payment from the bond.

   2. If a letter of credit is posted, the letter of credit shall (i) be in the
   amount of $100,000 or any other amount as set by regulation of the Board, (ii)
   be irrevocable and in a form approved by the Board, payable to the Department
   of Professional Occupational Regulation, and (iii) be for the use and the
   benefit of (a) a claimant against the licensee to secure the faithful
   performance of the licensee&#8217;s obligations under this chapter or (b) an
   appraiser who has performed an appraisal for the licensee for which the
   appraiser has not been paid. The aggregate liability on the letter of credit
   shall not exceed the principal sum of the letter of credit. When a claimant or
   an appraiser is awarded a final judgment in a court of competent jurisdiction
   against a licensee of this section for the licensee&#8217;s failure to
   faithfully perform its obligations under this chapter or failure to pay an
   appraiser who performed an appraisal, the claimant or the appraiser may file a
   claim with the Board for a directive ordering payment from the issuer of the
   letter of credit of the amount of the judgment, court costs and reasonable
   attorney fees as awarded by the court. Such claim shall be filed with the
   Board no later than 12 months after the judgment becomes final. Upon receipt
   of the claim against the licensee, the Board may cause its own investigation
   to be conducted. Upon a draw against a letter of credit, the licensee shall
   provide a new letter of credit in the amount required by this subdivision
   within 15 days after payment of any claim on the letter of credit. If the
   licensee fails to restore the full amount of the letter of credit, the Board
   shall immediately revoke the license of the licensee whose conduct resulted in
   payment from the bond.

HISTORY: 2012, c. 405; 2014, c. 210; 2018, cc. 229, 230.