Almost lost in the excitement and anticipation of the impending Dodd-Frank Financial Reform Bill, Fannie Mae issued Announcement SEL 2010-09 on June 30, 2010. This announcement related to updates to Fannie Mae’s selling Guide and provided additional guidance on several issues, many of which were appraisal-related.
Listed below are the most significant provisions for appraisers. They are, however, not the only issues addressed. A link to this announcement, which features clickable links to relevant portions of Fannie Mae’s Selling Guide, is available online at www.McKISSOCK.com/appraisal.
This announcement also clarified that lenders may communicate with appraisers to correct errors or to address lenders’ concerns about appraisal reports.
1. The number of listings used for the 1004MC form are to be based on the most recent day in the period
being analyzed. For example, in the “Current – 3 Month” period, only the number of active listings on the
current date would be included, not the cumulative number of listings for the entire three-month period.
This requirement became effective on September 1, 2010.
2. Interior photographs are now required in all appraisal reports for which an interior inspection is performed.
Photos are to include kitchen, all bathrooms, main living area, as well as recent remodeling, updates, and
3. Fannie Mae requires that an appraiser must possess geographic competency at the time the assignment
is accepted. It is not permissible for an appraiser to obtain geographic competency during performance
of the assignment.
4. For new construction, an appraiser may use the HUD-1 Settlement Statement from a builder’s file as a
verification source for a comparable sale, if the sale is recent and not available from other sources. It is not
acceptable for an appraiser to use only sales of this type; other sales must be verified from reliable data
sources, other than the builder.
5. In the sales comparison section of the URAR form, the appraiser must state the specific data source for
comparable sale information, and “refrain from using broad categories, such as ‘public records’.” Some
underwriters have been interpreting this to mean that appraisers must put the public record document
number and/or the MLS number for each comparable sale in the report.
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