Written By: Stacey Sprain
As was recently passed and communicated throughout the industry, Fannie Mae and Freddie Mac support and are committed to appraiser independence requirements and will continue to review and address market developments and regulatory actions taken pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. WE can expect to see further guidance on rules relating to conflicts of interests and fee disclosure by appraisal management companies.
Fannie and Freddie have converted to Appraiser Independence Requirements which replace Home Valuation Code of Conduct (HVCC) but as an originator or processor, you shouldn’t be significantly impacted as long as your employer and lenders had procedures in place in place to comply with HVCC up to current. The intent of Appraiser Independence Requirements is to protect the independence of appraisers, the integrity of appraisals, to extend the same protections to home buyers, mortgage investors, and the housing market as well as to reinforce agency commitment to responsible lending and mortgage quality standards.
When the lender delivers and sells a loan to either of the agencies, they must represent and warrant that any appraisal conducted in connection with a single-family mortgage loan (other than government-insured and -guaranteed loans) delivered to Fannie Mae, with an application date on or after November 1, 2010 conforms to the Appraiser Independence Requirements. Any conventional single-family mortgage loans with an application date on or after May 1, 2009 through November 1, 2010 must comply with the former HVCC requirements.
The actual content of the new Appraiser Independence Requirements can be read athttps://www.efanniemae.com/sf/guides/ssg/relatedsellinginfo/appcode/pdf/... which in short, is really a repeat of the content of the former Home Valuation Code of Conduct (HVCC) requirements which can be read athttps://www.efanniemae.com/sf/guides/ssg/relatedsellinginfo/appcode/pdf/....
Appraisal Data Standardization and Electronic Appraisal Report Submission
Another appraisal-related topic that has been “drip campaigned” in combination with Fannie Mae Loan Quality Initiative Requirements is Fannie and Freddie’s Appraisal Data Standardization and Electronic Appraisal Report Submission Requirements. The goal of these new requirements is to provide common requirements for appraisal and loan delivery data, including:
• A Uniform Appraisal Dataset that standardizes key appraisal data elements to enhance data quality and promote consistency.
• A Uniform Collateral Data Portal (UCDP) for the electronic collection of appraisal data.
So the question becomes, how do these new requirements impact the common originator, processor or underwriter? Well the good news is that the requirements do not become officially effective until November of 2011 so for most, it’s nothing to worry about at this exact moment so it’s “business as usual.”
I will offer further information on the topic of Uniform Appraisal Dataset in the near future after I learn more about it.
About The Author
Stacey Sprain - As an NAMP® staff writer, Ms. Stacey Sprain is currently a NAMP® member in good standing, and is a NAMP® Certified Ambassador Loan Processor (NAMP®-CALP). With over 15+ years of mortgage banking experience, Stacey is also a Quality Control Manager for a major mortgage lending institution. If you would like to become a volunteer writer for us, please email us at: firstname.lastname@example.org.