Fannie Mae Issues “Hard Stops” on Appraisal Messaging
As of January 28, 2013, Fannie Mae started placing greater restriction on the data they collect to ensure uniformity. You will now begin seeing a “hard stop” issued by Fannie Mae on messaging. This change affects Appraisers working with AMCs or other lenders who submit data to Fannie Mae.
What has changed?
As appraisers know, the Uniform Collateral Data Portal (UCDP) is an electronic tool that Fannie Mae uses to ensure uniformity in the data that Appraisers collect and submit. The theory is that being able to track trends and information through data collected on appraisals will ensure more informed lending decisions. In order to track trends and data accurately, it must be as uniform as possible.
What does that mean for Appraisers?
According to Fannie Mae, the “…messages are designed to help lenders detect data inconsistencies and improve the overall reasonableness and quality of appraisal data.” If an inconsistency is detected, you will receive a “hard stop” notice. This means that until data inconsistencies are corrected, Fannie Mae will not accept the appraisal.
The good news is that this will hopefully reduce the number of requests that you receive for corrections after the fact. The bad news of course is that, unless you conform with Fannie Mae’s policies, your appraisal will not be accepted.
What do you need to do to resolve hard stops?
First and foremost, consider who is actually going to be reading your appraisal report. Fannie Mae is creating uniformity for a reason — to make your reports more easily understood by computers instead of actual people. Appraisal Today recently posted an article on the steps you can take to prepare for these changes, but it starts by making sure that your appraisal software’s UAD checker is doing its job and you are receiving notices about warnings before you actually submit the appraisal report.
More information about resolving hard stops can be found in Section 4.3.3 of the UCDP General User Guide.