Condo Appraisal Protocol Changed

Condominium Appraisal Protocol Changed. 

Fannie Mae’s sweeping new national condominium regulations…

Appraisers, Fannie Mae has changed inspection and reporting requirements for Condominiums, effective January 1, 2022. The article titled “How can appraisers evaluate aging condos without docs?” from Loop North News has info:

From the article:

24-Jan-22 – Fannie Mae’s sweeping new national condominium and co-op apartment lending regulations were created to protect residents, but the tough rules do not cover all the problems, appraisal experts say.

High-rises with “aging infrastructure and significant deferred maintenance is a growing concern across the nation,” noted the Fannie Mae memorandum, issued as a result of the tragic collapse of the Champlain South Tower in Surfside, Florida, which killed 98 people. The new regulations went into effect on January 1, 2022…

Fannie Mae’s rules now require that lenders and appraisers review a laundry list of items before mortgage approval, including the following documents:

  • The declaration (or covenants), conditions, and restrictions (CC&R), bylaws, house rules and regulations.
  • Board meeting minutes, state mandated disclosures, prior and current year budgets, and the reserve study.”

Reviewing condo docs critical but expensive

“Doc fees can range from $50 to $250 per document, so the price can really add up depending on the number of documents requested,” Benson said. “On average, fees may run in excess of $500 for electronic delivery for a complete set needed to complete a condominium sales transaction.”

For more details, refer to the FNMA Selling Guide, B4-1.4-03.

Dave Towne
Image credit flickr - SomeDriftwood
Dave Towne

Dave Towne

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

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13 Responses

  1. Avatar Jason says:

    This is not financially feasible unless we don’t have to pay for these docs. One management company wanted to charge me $175 to answer a few questions.

    • Avatar henry says:

      1. So reporting on aging infrastructure and significant deferred maintenance is fine; it is what IS obvious AND observed. We do not have x-ray vision. We don’t have access to all levels, common areas, and/or private areas.

      Appraisers are NOT ENGINEERS or home inspectors.

      2. Obtaining condo declaration (or covenants), conditions, and restrictions (CC&R), bylaws, house rules and regulations is near impossible due to we are not the homeowner, borrower, and/or lender.
      Plus paying management cos. and/or HOA FEES to obtain these docs is not financially feasible or timely. Reading through 100s & 100s of condo documents is not even with in our scope of work. This is for real estate ATTORNEYS to obtain, decipher, and disclose.

      3. Furthermore obtaining board meeting minutes, state mandated disclosures, prior and current year budgets, and any reserve study is for real estate ATTORNEYS to obtain, decipher, and disclose for their clients and for ACCOUNTANTS to analyze. Again appraisers are not given access to these documents and/or it is expensive too acquire.

      I guess it is time for another “boilerplate” statement to limit our liability to more Fannie nonsense. They can kiss my Fannie.

  2. Avatar Bill Johnson says:

    Considering the coach says urban and suburban appraisals are always easier than rural appraisals, good luck to use all when we are required to look through hundreds of pages of CCR’s, past engineering reports, 6 months of HOA meeting notes, etc. ( ). How about the issue where some HOA companies locally work on a 7 to 10 day turn time for documents as is? ). Open the flood gates to such documents, and expect to get the appraisal back several weeks later.

    I guess I will have to wait for the next blog to see how I can be coached to profit from this, and or be told how this to could be outsourced to the Philippines.

    Seek the truth.

  3. Scott Taylor on Facebook Scott Taylor on Facebook says:

    Of course because appraisers are also financial experts and can correctly analyze a condo’s budget and expenses. Just another way to pin any problems on the appraiser

  4. Avatar DAK says:

    What, No Hybird or Waivers!

  5. Avatar PJTMC says:

    I have been following the comments closely as well as spending significant time reading and trying to understand all the changes that are being required. It is fairly obvious there is a lot of anger and uncertainty that we all need to resolve. Some new requirements are pretty straight forward while others are oblique with terms like “best judgement” etc. No doubt we are all going to experience the same inability to meet a requirement at some time or another and it would be nice to access a site where other appraisers can see how their peers are addressing the various issues in a disclaimer. I propose such a site be established in which ONLY appraisers can access the site for guidance. It seems the least we can do to protect ourselves and our profession from the relentless onslaught of attacks on our profession. This is not intended as some evil driven conspiracy but a reliable data source appraisers can use to improve themselves, our industry and consistency of appraisals throughout the country and isn’t that the FNMA mandate. If we stick together, we can all work through this but there needs to be a plan in place to follow. I myself do not have the technology prowess to make this happen but I am sure someone out there does.

  6. Avatar Pat Turner says:

    We aren’t lawyers.
    They are making us liable for everything!
    Not me.
    I will not step off of this improper edge.

  7. Avatar henry says:

    So now Fannie wants us to be accountants, attorneys, and engineers? Talk about overkill & unnecessary liability.

    A HOA or management doc is $150-$350 alone. No way I’m paying for those. In fat most HOAs won’t even given the general public any info/docs to begin with unless you are a owner.

    They can kiss my Fannie.

  8. Avatar Scott says:

    I’ll just charge $2,500 or quit doing Condo Appraisals. Why give myself brain damage and increase my liability? They keep moving the goal posts on us and wonder why appraisers are leaving the industry in droves…

  9. Avatar John Pratt says:

    This requirement for the appraiser to review the budget of the “HOA” is not new. It has been in Fannies Selling guide for several years, it just has ;not been enforced on the appraisers. I wrote a blog in this space several years ago about this subject. I do not know one appraiser that is qualified to review a HOA budget and comment that their reserves in the budget are sufficient to meet their anticipated needs. Most accountants would not even consider doing this without a large fee, probably $ 5,000 or more. I quit doing Condo appraisals 10 year ago.

  10. Avatar henry says:

    So now we are supposed to be ENGINEERS. ATTORNEYS. and ACCOUNTANTS? …while being paid a lousy $400 condo fee?

    HOA docs are not even attainable or available to the general public/appraiser majority of the time unless you are a owner.

    Plus docs cost $150-$300 to obtain. They can kiss my Fannie.

  11. Avatar Patrick C says:

    You are correct however it is only as good as the parties it is requested from to provide it. In reading the requirements the onus of providing may now lie with the Lender if the appraiser is unsuccessful. Further, reading the requirements, if it isn’t reviewed by the appraiser, the appraisal can’t be completed. That being said and as pointed out, I am an appraiser not an accountant. It seems this should be assigned to a number’s cruncher who has the education, license, experience and expertise. I’ll bet there are appraiser s out there that can’t organize their own budget let alone a budget of hundreds of thousands of dollars. All kidding aside it boils down to doing more with less and having a scape goat.

  12. Avatar Tom D says:

    my lender is now getting more docs. they have also talked directly to fnma about the difficulty of figuring out all this info. fnma seemed to agree, and there may be more clarifications coming out in the future. it’s an over reaction to older aging condo loses that fnma has experienced.


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Condo Appraisal Protocol Changed

by Dave Towne time to read: 1 min