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Reg B requires a copy of the Appraisal notice and a copy of the appraisal is to be given to a borrower even when the home is not their primary dwelling. Can you please explain why this would be required on a commercial 1-4 family dwelling loan which would not be their primary dwelling? For example a rental home, spec home, etc. Some of my loan officers question the reasoning behind this.
Everything in Regulation B is about avoiding illegal discrimination. While most discrimination cases involve consumer transactions, discrimination can occur in a business transaction. For example, a minority individual may be borrowing money to start a business and is providing property (primary dwelling or rental property) as collateral for the loan. The property is appraised at a value that is less than market value and the loan is denied. The borrower receives a copy of the appraisal and can evaluate whether the apprised value is appropriate or not. If the appraisal is not supported by appropriate comps the borrower can request re-evaluation.
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