frt

(redirected from federally related transaction)
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frt

Abbr. for “freight.”
References in periodicals archive ?
The definition of federally related transaction is often misunderstood.
Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) provides protection for federal financial and public policy interests in real estate-related transactions by requiring real estate appraisals used in connection with federally related transactions to be performed in writing, in accordance with uniform standards, by appraisers whose competency has been demonstrated and whose professional conduct will be subject to effective supervision.
Title XI defines a federally related transaction as "Any real estate-related financial transaction which (a) a federal financial institutions regulatory agency or the Resolution Trust Corporation engages in, contracts for, or regulates; and (b) requires the services of an appraiser.
For example, if a borrower owes $125,000 on a property and wants to borrow $10,000 on a second mortgage, such a loan is not a federally related transaction because the second
10 (SMT-10) provides clarification, interpretations, explanation and elaboration on the appraiser's USPAP obligations when performing assignments for use by a federally insured depository institution in a federally related transaction and that SMT-10 also discusses supplemental standards issued by federal financial institution regulatory agencies for appraisers, as well as requirements imposed on the lender that the lender or its agent directly engage the appraiser in such assignments.
These changes in appraisal regulations mandated by Title XI of FIRREA increase the level of standards for appraisals prepared in support of federally related transactions.
As first enacted, Title XI required that after July 1, 1991, all appraisals for a federally related transaction be performed by state certified or state licensed appraisers.
Certified residential real estate appraiser: May provide appraisal services in federally related transactions with: 1) one-to-four-unit residential properties without regard to value or complexity; and 2) commercial properties having a transaction value of less than $250,000.
Title XI contemplates a dual state and federal role in fulfilling its goal, which, as indicated in its statement of purpose, is to provide "that federal financial and public policy interests in real estate-related transactions will be protected by requiring that real estate appraisals utilized in connection with federally related transactions are performed in writing, in accordance with uniform standards, by individuals whose competency has been demonstrated and whose professional conduct will be subject to effective supervision.
These new rules make a mockery of Title XI by exempting transactions under $100,000 from the Title XI requirement that a state licensed or state certified appraiser must be used in all federally related transactions.
Title XI of FIRREA was enacted "to promote the safety and soundness of insured institutions by requiring that real estate appraisals utilized in connection with federally related transactions be performed in writing in accordance with the uniform standards by individuals whose competency has been demonstrated and whose professional conduct is subject to effective supervision.
However, an AMC is barred by section 1124 [of Title XI of the Financial Institution Reform, Recovery and Enforcement Act of 1989 as added by Dodd-Frank's section 1473] from providing appraisal management services for federally related transactions in a state that has not established such a regulatory structure," the press release stated.
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