FHFA Announces New Appraisal StandardsApril 2011 – Newsletters In the Zone
New standards for appraisals were recently announced by the Federal Housing Finance Agency (FHFA) and will take effect September 1, 2011. The Uniform Appraisal Dataset (UAD) was created to improve the quality and consistency of appraisals on mortgages for Fannie Mae and Freddie Mac.
The FHFA developed the UAD, which defines all fields required for an appraisal submission for specific appraisal forms and standardizes definitions and responses for a key subset of fields, to improve the quality and consistency of appraisal data on loans delivered to the government-sponsored enterprises (GSEs).
The UAD standardizes certain data points to support consistent appraisal reporting, regardless of geographic location of the property or any localized reporting conventions, by addressing vague or disparate data currently included on some appraisal reports.
The UAD only applies to single-family residential properties and condos (not multifamily units or manufactured homes). At this time, the UAD requirements do not apply to Housing and Urban Development (HUD) or Veterans Administration (VA) loans.
The GSEs are also developing the Uniform Collateral Data Portal (UCDP), which is a single portal for the electronic submission of appraisal data. Lenders will be required to use UCDP to deliver electronic appraisal data that conforms to the UAD before the delivery date of the mortgage loan to Fannie Mae or Freddie Mac. This requirement applies to all conventional mortgage loans for which an appraisal report is required.
Through the UAD and UCDP, lenders will have a GSE-consistent approach and understanding of appraisal definitions and requirements and a common submission portal for submitting appraisal data. This critical appraisal data standardization effort will provide lenders with greater confidence in loan quality by offering enhanced appraisal data quality and integrity regarding the collateral valuation of their loans.
For appraisals with an effective date (date of inspection is the effective date of the appraisal) on or after September 1, 2011, specific appraisal report forms must be completed in compliance with the UAD for conventional mortgage loans sold to Fannie Mae or Freddie Mac.
For more information, please contact Kimberly A. Freimuth at 215.918.3627 or [email protected].