Category: Fannie Mae – Freddie Mac

Appraisal news for real estate appraisers and real estate professionals regarding the Fannie Mae and Freddie Mac. News relating to the Appraisal Industry.

Ending the Conservatorship... Potential Changes to GSEs Gaining Steam 2

Potential Changes to GSEs Gaining Steam

Folks, if you have not been hiding under a rock since 2009, you know that both FNMA and FrMAC have been under ‘conservatorship’, regulated by FHFA for over the past 10+ years. If you’ve been paying attention, you also know that over the past few years there has been increasing talk to end the conservatorship, and now, to add competitors to the GSE’s in the mortgage loan purchase arena. That prospect is outlined in the latest Report to Congress by Mark Calabria, Director of FHFA, summarized in this article posted Tues, June 16, 2020, in Mortgage News Daily: The Federal...

Professional Opinions Can Never Be Replaced By Automation 10

Professional Opinions Can Never Be Replaced

Professional OPINIONS have value that can never, repeat NEVER be replaced by automation… Earlier this week, George Dell‘s article titled “Why is Residential Appraisal in Trouble?” was published on AppraisersBlogs. Respectfully, George misses or misinterprets a few items. There has been zero evidence that an AVM produces credible approximations of MARKET VALUE consistently or with even an acceptable degree of variance. None. Like George indicates, an AVM is NOT an appraisal. By definition, it is not an appraisal. FIRREA required appraisal standards; NOT banking industry and TAF proposed alternatives. TAF is very far out of line giving AVMs any imprimatur...

Why is Residential Appraisal in trouble? Is Residential Appraisal Finished? 28

Why is Residential Appraisal in Trouble?

Why is Residential Appraisal in trouble? Is Residential Appraisal Finished?… There will soon be no need for residential appraisers. I remember years ago, doing education for my merging AIREA/SREA chapter(s) in San Diego. AVMs were just coming to our attention. I invited a MAI who happened to also be a PhD in economics, Phil Mitchell. The room was full. Someone asked about those “automated algorithmic computer calculated appraisals.” Could a canned program do as well as an appraiser? Without hesitation, he answered: “Not only will these models be able to appraise – they will do it better!” That was 24 years ago. He was right, partially. I...

The GSEs to Split from FHFA? Will the Separation Happen? 7

The GSEs to Split from FHFA?

A key issue is Congress’s thirst for the income the two GSEs generate since they paid off their bailouts… Will separation happen? I found this info in the Mortgage News Daily e-newsletter by Jann Swanson on May 19, 2020: From the article “Fannie/Freddie Seek Financial Advisor to Help Them Exit Conservatorship”: “Fannie Mae and Freddie Mac (the GSEs) have taken what each is calling an important step toward ending their 12 years of operating under conservatorship. Each has announced they are about to issue a request for proposals (RFP) to secure a financial advisor to facilitate that move. In a...

COVID-19 Issues Addressed & Interior Inspections Liabilities 29

COVID-19 & Interior Inspections Liabilities

Pay attention to Phil Crawford’s comments on interior inspections and the liability that goes with them… Fannie and Freddie have come out with updated guidelines for appraisals. There is much confusion on what is and what is not required. The below matrix simplified what is allowed by Fannie Mae. Additional questions and answers can be found on Lender Letter LL-2020-04. The unknown to the appraiser is the ownership of the loan. Appraisers must rely on the lender or amc for that determination. VaCAP wants to remind each and every one of you that regardless of what an amc or lender...

The Greatest Recession - The Hesitance to Accept Modified Appraisals 18

The Greatest Recession

The Greatest Recession is now spreading across the US. The investor’s hesitance to accept modified appraisals without interior inspections will prevent the real estate market from leading this country out of “The Greatest Recession” now spreading across the US… Appraisers provide an essential financial service according to the verbiage I’ve read from The Department of Homeland Security and various sources. We are exempt from “stay at home” orders. The State of Colorado has defined appraisal services and appraisers as providing an essential financial and professional service. Colorado says that appraisers are exempt from stay at home orders. An abundance of...

Exterior Appraisals & Temporary Appraisal Guidelines During COVID-19 16

COVID-19 Temporary Appraisal Guidelines

Fannie and Freddie are giving preference to desktop appraisals over exterior appraisals, which quite frankly, is completely backwards from what most appraisers believe to be a more reliable appraisal. HUD and the Veterans Administration, on the other hand prefer exterior appraisals…

Temporary Appraisal Requirement Flexibilities - FHFA Allowing Alternatives 18

Temporary Appraisal Requirement Flexibilities

Temporary Guidance From Fannie Mae… FNMA has issued temporary guidance on appraisal requirements, including allowing desktop & exterior-only appraisals… Folks, due to the ongoing COVID-19 national emergency, the GSE regulator FHFA and both GSE’s have issued new (temporary) guidance on Monday, March 23, 2020. These remain in effect through May 17, 2020, but could be extended due to the on-going situation. NOTE: I have seen nothing yet from FHA or VA. Appraisers (and AMCs) CANNOT modify assignments or reports without specific authorization from the lender client. Appraisers CAN choose to do, or not do, assignments under the inspection guidelines, and per directives...

AMC Celebrating One Million Appraisal Orders Sucker Punches Appraisers 40

AMC Sucker Punches Appraisers

Class Valuation sucker punches appraisers! Class Valuation has been celebrating completing 1,000,000 orders and sent a Tweet thanking their clients and staff. There is no mention of the boots on the ground licensed professional appraisers who actually completed those appraisals. Is this the true feelings of Class Valuation? Do they not realize not one order would have been completed without appraisers? Not one simple thank you… Meanwhile VaCAP has learned InHouse Solutions, the AMC division of Get Connexions, Inc. is ceasing all operations as of February 28th. Appraisers on their panel across the country have been getting this email: Jan...

Is That an Arm’s-Length Transaction? The Necessary Analysis 14

Is That an Arm’s-Length Transaction?

USPAP does not define the term arm’s-length transaction. Fannie Mae also lacks such a definition. Yet, both of them call for the appraiser to use only arm’s-length transactions as comparable sales… How often do we appraisers get into the mode where we think we know it all? Occasionally, do we need to step back and look at the way we do things, just to make sure we are not missing something? Is what we know to be true and correct really true and correct? I raise this issue relative to the concept of what an arm’s-length transaction is. Are we...

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