Secret Revealed… Coming NOT Soon

Secret Revealed: UAD & Appraisal Forms Redesign Coming NOT Soon

New initiative will focus on modernization of the current UAD dataset and residential appraisal forms…

What I originally described as a ‘rumor’ several months ago has finally been fully exposed.

FNMA and FrMAC are in the process of examining the current GSE appraisal forms, which encompass UAD and the MC Form, to ‘finally’ get the appraisal forms & functions into the 21st Century!

But it won’t happen for at least 3 years (2021)… by then many current appraisers will be enjoying bon-bons and brewskies while on the golf course, or be on their long-planned world cruise, after chucking their clipboard device into a trash bin and selling their laser measurer due to retirement, or perhaps frustration.

On May 22, 2018, the GSE’s released the formal announcement about this new initiative – the PDF attached.

From the announcement:

“The GSEs are working together, at the direction of the Federal Housing Finance Agency (FHFA), to assess and, as appropriate, begin implementation of strategies to redesign the UAD. Under the auspices of the Uniform Mortgage Data Program (UMDP)*, the initiative will focus on modernization of the current UAD dataset and residential appraisal forms. The initial stages of the multi-year initiative will explore options and make recommendations regarding changes to the UAD and appraisal forms that will support emerging technologies and data updates, and provide a foundation for appraisal process modernization.”

Part of this process will involve taking input from ‘stakeholders.’ I really wonder how deep into the appraiser population that will go?

Dave Towne
Image credit flickr - Mikey
Dave Towne

Dave Towne

AGA, MNAA, Accredited Green Appraiser - Licensed in WA State since 2003. Dave Towne on

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20 Responses

  1. I’m guessing that the FHFA is just going to ignore all the letters and emails telling and showing them that their “working paper” in support of AVMs is just more bullshit?

  2. Avatar Eric West says:

    I’ll bet we’ll see more codes added and more data entry requirement from appraisers to feed their CU.

  3. Avatar Bill Johnson says:

    I’m hoping the new forms with add a backsplash category directly below the bath wainscot within the improvements section.

    Seek the truth.

  4. Avatar Coach says:

    I wonder if real active appraisers will have any input. Were they involved the last time the forms were changed?

  5. Avatar Pam E. says:

    I don’t believe they have acted in good faith and they are just as corrupt as Wells Fargo. We should not be under the gse’s thumbs at all.

  6. Avatar Fritz Vogel says:

    I guess we will just have to raise our fees.

  7. Avatar E J B says:

    Hell, I’ve been enjoying brewskies for the past several years. If only these damn appraisals wouldn’t be getting in the way. But I must admit they are a good supplement to my measly SS.

  8. Avatar Jack Of All Trades says:

    Thank the gods that i won’t be doing this in 2021

  9. Avatar Dave Towne says:

    And as I’ve written to others………UAD will probably be incorporated into all property types, not just SFR and Condo. So multifamily 2-4’s and MFH may have that enjoyable process also.

    One thing I really hope is that the GSE’s will carefully review the interrelationship with all parts of the forms. To currently allow the “banned words” on page one (INDIVIDUAL COMPONENT condition ratings) but refuse them on page two (OVERALL condition rating) is absurd. The people who wrote and mandated the UAD did not take that into consideration.

    Secondly, if they want market conditions reported, get the info standardized into one part of the form, not scattered in two separate pages. Make sure the info correlates to the subject property, irrespective of non-comparable properties that don’t have a bearing on prospective purchaser decisions for the subject…….which is the fallacy of the present forms and how the data reporting was originally taught.

    • Avatar Bob P says:

      “Make sure the info correlates to the subject property, irrespective of non-comparable properties that don’t have a bearing on prospective purchaser decisions for the subject…….which is the fallacy of the present forms and how the data reporting was originally taught.” – Properties in heterogeneous neighborhoods (Subject surrounded by unlike properties) do impact decisions by prospective purchasers when compared to homogenous neighborhoods. Plop a turd in clean water or a rose in sewage and watch the reaction. The real fallacy comes from only analyzing comparable properties without considering the surroundings and thinking it reveals something significant. Try analyzing one of a few detached homes in a subdivision of attached homes, or a Cape Cod surround by Colonials, or oversized McMasion with indoor pool surrounded by small Ranch homes, and then say location does not play a role in the market analysis. Put the same dwelling in different locations, you get different results. Location, Location, Location exists for a very good reason. I agree, market condition reporting and analysis needs to be its own section and not scattered to distant pages. 1004MC is a joke with its limited, uneven timeline that fails to recognize real estate market trends often do not reveal themselves when standing too close to the trees that the extent of forest can not be perceived.

    • It would be a horrifically bad decision to put 1025’s into UAD format. Many appraisers have a tough enough time understanding all the nuances associated with income property that are not usually found in SFRs.

      Now trying to pretend that “absolutes” will result in more rather than less confusion; OR to suggest that units and room counts are as recognizable as GLA is would be a bad mistake.

      Most ‘peer’ or model adjustments in their database are simply wrong. On a 3/4 million dollar triplex the market value  difference between 2, 3, or 4 units is usually a function of the difference in rent received…not arbitrary $25k or even $50k per unit adjustments or $5k or $10k room count adjustments. (OK, I know-there are always exceptions).

      Many appraisers as well as reviewers have never seen or used an income reconciliation grid within the sales comparison. (If I knew how to spell “McKesson Grid” I’d have called it that). Anyway, its a more useful tool than most for 216’s will ever be. IF they redo the 2-4 unit form, then putting something like that kind of grid in (with formulas) could be helpful. I prefer one that also gives me Income multipliers; realistic operating expense ratios and OAR ranges though the ultimate summary focuses on values per unit; sf, room and GIM for the sales comparison. Use of this tool eliminates (most of)the line item adjustments aside from deferred maintenance (repair needs); incentives or market conditions).

      Rent control and a host of other issues will result in so many CU kickouts that it will bog the process down rather than speed it up.

      Not sure this spreadsheet will post; (Nope! had to delete in edit) Trying as pdf now:Nope

      • Baggins Baggins says:

        I’d appreciate standardized condo questionnaires, incorporated and standardized home inspection summary result forms, for the other guys of course. How come only the appraisal needs to be ‘standardized’?

        • Avatar Fritz Vogel AGA,CRS,CEI,GRI 27+ Yr Cert. Residential says:

          Condo HOA’s and Home inspectors are out of the lenders reach and control. We aren’t.

  10. Baggins Baggins says:

    My crystal ball is glowing right now. They’ll incorporate statistical entry areas and your Corelogic MLS software will have everything you need. The new form will be a progression towards automatic valuation modeling. Of all the things we appraisers can handle, the FNMA form change is one which could send tens of thousands of appraisers packing if there is over reach in requirements. Let’s think if FNMA has engaged in such over reach recently to see if we could predict their behavior… If you want to pontificate on what is likely to be in ‘new forms’, look to the managing authorities, the lobbyists, the predominant repurchase justifications, what efforts result in higher closing ratios, etc. It’s rather obvious given the bias of their last white paper on amc vs not quality relationships, their goal will be to promote the largest participatory companies wishes.

    • You are spot on regarding new form facilitating AVM or other alternative methods. FHFA made a decision long ago to adopt and promote AVMs. Their entire “working paper” on the subject proves their bias in favor of AVMs even thought the paper itself is fully refuted.

      Doesn’t phase them a bit though. They keep moving forward just as if their working paper had made sense. The last paragraph above from Dave’s article is bureaucrat-speak for “We’ve already made up our minds after consulting with the likes of REVAA, Corelamode and other vested interest software sellers.”

      • Baggins Baggins says:

        They should have to wear nascar style outfits so we know who sponsored them and controls their decisions. Certainly the interest of protecting citizens of the republic is no longer the primary directive.

  11. Avatar Fritz Vogel AGA,CRS,CEI,GRI 27+ Yr Cert. Residential says:

    Yeh, things will go our way. Things like the new HUD head honcho was a Caterer before….


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Secret Revealed… Coming NOT Soon

by Dave Towne time to read: 1 min