What Your Agents & Builders Need to Know About the New Conventional Appraisal Requirements!

Written By: MortgageCurrentcy.com Staff (MortgageCurrentcy.com)

Rule Synopsis:

Fannie Mae has announced they are establishing additional appraisal requirements to supplement the Uniform Standards of Professional Appraisal Practice (USPAP)

NEW Form 1004MC – “MARKET CONDITIONS ADDENDUM to the APPRAISAL REPORT” required on all 1- to 4- family appraisal reports dated on or after April 1, 2009, and includes

• Trend of Property Values, Demand/Supply, Marketing Time – Additional data required on form
  • Written conclusions and reasons: must be included in writing for declining market determinations, over-supply, or marketing time > 6 months
  • Transfer to appraisal: CONCLUSIONS reported on 1004 in “Neighborhood” Section
• Seller & Third Party Concessions Analysis – required to determine trends
  • Adjustments for concessions on market influence, not dollar for dollar
  • Adjustments may be required EVEN if concessions are typical

UPDATED APPRAISAL POLICIES

Effective with Appraisals Dated on or after January 1, 2009:

• Supervisory Appraisers – Must inspect all properties if signing as appraiser
• Sales Contract Required – Lender must provide appraiser with sales contract, all addenda, and all contract changes during the loan process
• Appraiser’s Selection of Comparables – Appraiser must provide explanation if comparable used is outside of subject’s neighborhood.

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