What action is prohibited for a residential mortgage originator regarding an appraiser?

Compensating an appraiser for services rendered is prohibited because it can lead to conflicts of interest and unethical practices in the appraisal process. Appraisers are expected to provide independent and objective opinions of value based solely on the properties they evaluate and the data available to them. If a mortgage originator were to compensate an appraiser, it could create a situation where the appraiser feels pressured to arrive at a certain value that benefits the originator or the transaction, undermining the integrity of the appraisal process.

The guidelines set forth by regulatory bodies, such as the Dodd-Frank Act and various state laws, specifically address these practices to ensure that appraisals remain impartial and reliable for lenders and consumers. By prohibiting such compensation, the intent is to maintain the appraiser's independence and support fair lending practices.

Understanding these regulations is crucial for mortgage loan originators to uphold ethical standards in the industry.