New UAD Overhaul: What Appraisers Can Expect in 2025 & Beyond
Folks, I recently attended a Train the Trainer 1.5 day class about the new UAD/URAR, jointly facilitated by Fannie Mae, Freddie Mac and Aloft. About 20 other instructors from across the US were also present. This class is required before this new UAD material can be taught to other appraisers, under contract with the GSEs.
My info below is a limited high-level summary for the new UAD and URAR of what was presented, and what the appraiser community can expect to see, from now into 2026. It is not meant to be comprehensive; I may send out other info as I become more familiar with UAD 3.6 and the updated URAR.
First, let’s examine the time line for the development and implementation process:
We’re currently in the middle portion (side-to-side) of this graph. Note how the orange Software providers are associated with the top dark blue section. I can tell you that the software development process is a massive undertaking, due to how the new ‘dynamic’ Report process will work for various kinds of residential housing. Each of the software vendors are working independently to produce their data recording and reporting processes. Currently, none that I know of have their software ready for full appraiser user testing. That should be done by at least the start of the third quarter 2025.
Training for this new process for appraisers should begin occurring in 2025, Quarters 2.5-3.5. This training will be separate from the individual appraisal software provider training. Actual ‘live’ use of the new URAR and UAD v 3.6 won’t begin with limited lenders until 2025 Q3, so training early in the year may not be productive. The appraisal software providers will be offering their own specific training at approximately the same time frame.
FHA, VA and USDA will be incorporating this new process for their residential lending Reports in roughly the same time frame as will happen with GSE Reports. Specific data aspects within Reports required by them will be incorporated into UAD 3.6.
Forms vs Reports –
Banish the word ‘form’ from your vocabulary when discussing this new version of UAD. The legacy (current) UAD (ver. 2.6) was built on top of individual pre-printed forms. This new version, numbered UAD 3.6, is dynamic. That means you won’t start a Report with a specific form; you’ll start with residential-type assignment criteria determined by the lender who will want certain items reported, depending on the property and Report type. The Report will populate data inclusion elements depending on necessary items that are required to be included in the Report per residential property type. The completed Report will be output and uploaded to the client from the software as a PDF.
NOTE: I’d suggest every Subject assignment have a preliminary data check done before the appraiser arrives at the property. Get into County, Parish, MLS records first, input necessary elements into the preliminary Report, then go out and waltz up to the front door. That way you will know what is in place (theoretically!), verses what the client thinks exists. Clarify assignment Report conditions if changes are necessary prior to going to the Subject property.
Quality and Condition Ratings –
We learned that the Definitions for Q and C have been updated for more clarity. These will be in a new Appendix F-1, (available on the GSE web sites) which appraisers should review BEFORE beginning to do UAD 3.6 URAR Reports! Secondly, the Report will allow for better reporting of Q & C ratings for various components. And additional property amenities can be selected from a list or drop-down.
Comments & Exhibits within Report –
The current ‘forms’ have individual “sections” for reporting data. But the comment space is limited, often requiring extending comments onto Addendum pages. The new dynamic Report will have similar “sections.” But each “section” will have expandable additional space for extensive comments as necessary, and there will be NO ADDITIONAL ADDENDUM pages in Reports. Exhibits that the appraiser wants to include with a “section” will be placed there. This new design of Reports keeps relevant comments and exhibit info together and eliminates the need for Report users to ‘flip pages’ to find what you wrote or included about a particular item pertaining to that section topic.
Sales Comparison Grid –
It will look similar to the existing ‘form’, but there will be additional reporting elements over 2 – 3.5 LEGAL LENGTH pages, divided into “sections.” I’m not yet sure if all items I see on Appendix C-1 will be in every Report. A front photo of each property will be at the top of the grid column. New data elements are currently included, requested by underwriter users, but in class we educators strongly questioned the necessity and validity of those items. Whether they indeed remain on the final URAR Report version is something to watch for. Adjustments for differences will be done similarly to what we do now on the current ‘forms.’ I won’t provide additional details here, but may in the future as this new process is carefully examined. Due to the dynamic nature of this new process, it will take time to research and comprehend.
Technology –
Reported elsewhere prior, and discussed in class, is whether or not the appraiser should use a tablet in the field while inspecting/observing the Subject and Comparables. In my view, absolutely, unfortunately! The days of pencil, pen and clipboard are fast disappearing, except perhaps for measuring and sketching the subject on-site. But even then, new technology developed over the past few years is proving very robust in delineating the Subject sketch to the ANSI standard. ANSI sketch compatibility will be incorporated into the new Report. The new URAR reporting process using UAD 3.6 involves so many additional data points that an appraiser inspecting without a tablet likely will overlook necessary items while in the field, and may have to make one or more additional trip out to collect the required data. This will be especially problematic for the Comparables if MLS data is minimal or lacking.
Time Involvement –
As we in class became more attuned to this new process, it became evident that the appraiser’s time involvement to complete a UAD v 3.6 URAR Report will be extended beyond what is experienced nowadays. In most cases, the Report will involve both office desktop and field tablet inputting of data, which at this point appears to be more comprehensive than is currently required. Will the lenders recognize this fact, and correspondingly tell their lending client that the “appraisal Report” will cost more than what it might have in the past? More importantly, will appraisers quit accepting low-ball fee assignments? These are unknown at this point.
Predominant eliminated! –
One of the dumbest required items on the current ‘form’ is itemizing the Predominant sale price. That means “the most common, or most frequent” sale price. Seldom does that exist! Wisely, this has been eliminated. The new Report will ask for lowest, median and highest Sale Price, and per common sense, the appraised value should be within those low and high figures.
This entire process to modify these residential appraisal reporting practices is incredibly complex. That’s why it’s taking multiple years to implement. Keep an eye out for training classes offered, because you will need to become familiar with BOTH the UAD v 3.6 URAR requirements, distinguished from your brand of appraisal software’s process to complete Reports.
Dave Towne on e-AppraisersDirectory.com
- New UAD Overhaul: What Appraisers Can Expect in 2025 & Beyond - September 19, 2024
- Cindy Chance Terminated - September 16, 2024
- Key Part of USPAP Not Available from TAF - July 19, 2024
I don’t think the idea is to fill all data points via tablet on site. The new UAD changes could (hopefully) end up being a big improvement in productivity and quality.
Bradford’s NightHawk presentation explores the sort of things that were not possible before with the ancient 1004 PDFs:
https://www.bradfordsoftware.com/nighthawk
Of course, it all depends on the implementation.
The NightHawk presentation at ACOW was a flop. The data was all wrong for the property that they were trying to test it on.
Well that’s really disappointing 🙁
Just about every problem your tech ‘solved’ is something we used to refer to as every day competent business management. If they would not have participated in amc industry fraud, they’d never have needed those tools to handle the volume sixty thousand other licensed appraisers could have and would have handled in their place.
I don’t understand this response, was it to me? If so, can you elaborate?
Great, so we will spend hours (no raise in fee of course) detailing a hundred more points of the subject only to find agents still can’t identify basic property characteristics in their listings, and local governments fail to separate out such basic things as basement area from GLA. What good is one set of data points when its nearly impossible to determine what another property has?
Seek the truth.
My thoughts on the new form. Well it will be implemented late in 2025 so not to upset the large amount of appraisal lending work to follow from now till Dec 2025. The lenders now have job ads for hiring staff for the next BOOM getting ready again to hire office staff and mortgage loan professionals to service the very large amount of Refinance Loans and Purchase Loans to follow with each month the mortgage interest rate drops.
So expect to be extra busy as an appraiser soon as the Property Data Collectors with limited experience that will also compete in the over flow of work. As for myself as an appraiser, I will wait until the media news sources are crying out for appraisers and then i will selectively agree to do Nothing but the Rush assignments with large rush fees when the work load is 3-6 weeks out before an appraiser can inspect a property. Borrowers have Free Will to wait for ever for an appraiser or agree to a high fee rush assignment in 48 hours to secure a lower mortgage interest rate.
Meanwhile 99% of my work is General Purpose Reports, Non Lender Appraisal and 1% is lender work. My reports will still include 11 Statistical Charts and Scatter Graphs which I down load from MLS CMA and export directly into the report for a reader to actually make sense of the new form with over 20 pages of form report from the prior 6 page form report.
IF you don’t want to raise your fees, that is on you. IF they are asking for more work and time, then raise your fee. Simple as that. IF you bend just once, then they have you at whatever fee they name. You name your fee.
Hey, waddaya mean?! When I ask agents what sort of condition their listing is in, you know, new, excellent, very good, good, average, fair poor, they always tell me that it is really cute. If that’s not descriptive, I don’t know what is!
Puffing anyone?!
Good points Bill. You’d think with all the effort and resources they’d develop simple tools for more quality BPO and realty agent side price development. I keep seeing variety bpo’s filled out and most times say to myself; if an appraiser tried that approach the report would be immediately rejected, they’d never even get through the automated review gates. Why are they focusing on appraisals given the abysmal state of most realty agents inability to utilize and fill bpo forms correctly? Central planning never works.
This is a link to a FNMA folder with 12 sample appraisal reports. There are 5 SFR appraisal reports; 2 MH; 1 COP; 2 CONDO; and 2 MULTI. Once at this page, scroll down and CLICK ON “Appendix D-1: URAR Sample Scenarios and XML Files” where a .zip file should be opened or downloaded to your web browser where you should see the 12 sample reports.
https://singlefamily.fanniemae.com/delivering/uniform-mortgage-data-program/uniform-appraisal-dataset
Well I’ve had a great run in this profession. Retirement in less than one year from today and I’ll be shutting down my business. Others that were with me retired during COVID and I didn’t feel up to bring on new ones. Good luck ya all!
AB I appreciate this website!
Right there with you. I moved up my retirement 1 year. Was going to be end of 2025 now it will be end of 2024. Cannot wait. God speed to you!
Me too. It’s been a great run but I’m worn out.
I hear you, I wanted to leave before I really no longer loved what I do…that time has come.
It’s funny. I wasn’t sure when I would retire, thought it would be a few years. But I just hit a wall one day and said it’s time. Every report became drudgery.
Agreed! It was a good run. But when business suddenly dried up in the Fall of 2022, thanks to living below my means and some well-timed R.E. investment, I did not seek out new clients or opportunities, content to take what little still came in, which has been next to nothing.
I tell my friends I pretend to be retired. I’ll make it official when my license expires in November. Talk about a career and a profession fizzling out!
yep! the writing is on the wall.
Count me in. I ‘ll be done, too.
As I have said before this report reminds me of a cross between an appraisal, an inspection and a relocation report. Will you get paid for all the extra work and liability. Oh hell no! I feel for the newbies entering this profession with the new PAREA education using the current 1004 form and then having to deal with this new form. These new Appraisers will be thrown into the Lions Den, unless those that teach the class will be hiring them as well, which some I understand may be doing. If not, the new students who take this course will still need some sort of mentor especially with all the changes coming.
I wish you all God Speed and prosperity in the coming years, it will be one rough roller coaster ride. I have already survived Dodd Frank, The Real Estate Boom from early 2000’s to the crash in 2008-9 and I do not intend to have to deal with the new form and the whole bias issue that looms large. Luckily most of my business has been personal with only about 5% lender business last year and 1% this year. If I had relied on lender business, I would have retired before now.
Be safe out there everyone!
One appraiser’s vision of the (near) future:
Imagine having your own privately hosted Large Language Model (LLM) or soon-to-debut Artificial General Intelligence (AGI) model. This in-house appraisal tool will input and analyze all your photos, on-site video footage, and LiDAR measured dwelling information. Your LLM will then automatically export descriptive text and image data to the new appraisal software that’s currently being developed.
Other modules will sift through all local MLS data, identify the best 6-10 comparable sales, generate market statistics, and export automatically adjusted comp sale data. All of this will happen in just 10-20 seconds, including calculating and justifying adjustments on the grid.
Just think of how much time you will save! How much money you will make! Like Donald Fagen sings, “What a beautiful world this will be. What a glorious time to be free.” I sure am glad the GSEs and AMCs won’t use their own in-house LLM and AGI systems along with third-party data collectors!
This one really ruined my day. The pace of systemic data irregularity will increase at an exponential pace. Did they even dare to tackle the NAR settlement and likely need for appraisers to validate concessions data if that could possibly be agency fees? Is there a new line for that?
I’ve read through the entire technical specs of this last year and the years prior. I’m not looking again because I will not be using this form. The concept was incompetently formed around a false premise that the current form was not functional. Nothing has changed since then.
What exactly is wrong with the current forms?
Those forms make it harder for the transition to AI? Also, isn’t that why the 800 lb gorillas in the room made ANSI mandatory? If ANSI was so great why then doesn’t the VA/HUD require it and USDA is still thinking about it…lol. Last I checked only a total of two states, Kentucky/Mississippi have ANSI as mandatory for their county assessors. Hmmm
Agree
Dynamic, huh?
The new “form” asks if broadband is available (yes/no). What definition of broadband are we using? The FCC just updated their definition this year to be a minimum of 100mb up and 20mb down. But according to broadband.com there are 45 million Americans that do not have access to the new definition. There are many plans with 100mb+, but many limit download to a max 10-15mb with no higher download speed available. I personally have 300 up and 10 down (I could get up to 500 up 50 down so it is available). My plan is plenty fast enough, but technically does not meet the FCC definition of broadband. Do we have to find all the internet providers available to the subject dwelling, and then find out if at least one of them has a plan that meets this definition? And if they don’t is FNMA expecting us to make an adjustment? Another superfluous data field from FNMA.
Presence of any given municipal or private service tie ins is a curable and ever changing obsolescence. Every single day labor crews lay new lines to the remote places of the world. Every day existing systems break down somewhere. Who will be the first to check that box yes because of starlink or hughes net?
When even seasoned licensed appraisers and realty agents, will not be able to understand their own appraisals delivered for their own home loans. What are they doing still playing around with .zip files in 2024? This is a tremendous waste of resources which would never have received such an investment in the private sector. As will be evident in the near future, by the way only fannie and freddie will adopt this model. Everyone else including courts and investors, the entire realty sales community, most likely hud and the va, will still be utilizing a classical one page grid model. Because normal people can understand what they’re reading.
Special note to the tech nerds working on this forms project; The appraisal grid is one big math equation, rendering the most possible aspects of property versus property comparisons in a way which allows for a mathematical expression and calculation of value. Every line item entry is it’s own mathematical element.
What kind of idiot spreads a single math equation across ten different pages and forgets a net/gross total adjustments comparison line? Obviously someone not very good at math. Still going to need to print this out on paper. Some of us still care about the environment and use pens and paper. FNMA; in support of more ewaste, apparently also doubling down as tablet and mobile device salesmen.
They should scrap the entire forms redevelopment project. What an incredible waste of manpower and resources, only to end up with a less functional version of the same thing. In the meantime, everyone from courts to estate services, other sections of government which use appraisal services, state governing boards and administrative appraisers, the entire realty community, will still be using a general purpose form or standard bpo. It’s almost as if a criminal organization is attempting to cover for pre planned fraud activity with some confusing and confounding new technology… Never underestimate the damage that incompetent program managers can cause.
“Almost”?
Regardless, I’ll be the one of the professionals who is raising fees to cover the time involved in creating this new appraisal.
More than ever, appraisers must know their worth!
Dave described something that Im. bettimg will have to fall in the $1,000 – $1,500 range for non complex jobs.
Anything with a 2nd unit will need to be treated as the small income property it is, rather than the mythical “ADU” label that so many think excuses all permit failures, rent control, and tenant rights and their impact on value and marketability.
I’m currently charging (generally) $2500 to $3500 for most complex jobs. I doubt MISMO oriented lenders expect to pay those kind of fees, so I doubt I’ll be doing GSE work anymore in the future than I do now.
Again, I urge appraisers to seek other revenue streams, than GSEs.
Or….just do private work as the AMCs will not compensate the fee appraiser for their time. They don’t now and they won’t later.
If they really want to make appraising more efficient they need to eliminate the requirement for appraisers to drive to the comps and get pics.
it is a waste of time 90% of the time. Once in awhile, you come across something interesting, but by and large, it is a waste.
exactly, we can see any location or view differences from the plat maps reviewed. And if the house (comp) has been totally renovated since purchase than the photo it is misleading to the reader of the report. Of course I would put that in my comments but not always are the comments read completely by the UW.
A picture is worth a thousand words but an in person visit (subject/comps) is worth a million. I had a comp in a neighborhood I was well familiar with and after viewing the listing photos I yelled at the agent (in my head of course) where the hell are the pictures of the mountains the house was facing. She had not included one. The pictures of the outside of the house were so close to the structure that you could not see any surrounding features. Just my thoughts.
Like that comment Koma. Some people are naturals with a camera. Other people simply never took the time to acquire those skills.
The days of simply copying photos for this type of work are now more complicated. MLS’s nationwide have updated their rules.
https://recolorado.com/security-of-your-data/
https://cdn.recolorado.com/files/MLS-Policy.pdf
Pg 25-32, ownership of mls compilations and copyrights. What is contained in appraisal reports is not the GSE’s privately owned data they can do whatever they want without restriction.
The appraiser is supposed to be the one defining the scope of work, not the lender. Yet the automation aspect of the new forms appears to put the lender in complete control, and leave the appraiser in the dark. Reminds me of government shenanigans; You have to pass the bill (accept the order), in order to find out what’s in the bill (what your scope of work will be).
Still in favor of the in person comps pictures requirements. In fact, realty sales agents should be held to the same standard. Amc’s have taken advantage of these requirements, which is why a substantial portion of simple appraisal work has now been shifted over to realty persons instead.
There is no substitute for seeing a home in person, that often includes comparables. This will always be a debated issue due to the nature of housing in different locations. Taking an elevator to get a photo of a front door in a high rise is of course rather pointless. Quite often so is taking photos of comps in the same high density housing areas. On the other hand, from complex to complex, or house to house in dynamic neighborhoods with different characteristics, seeing first hand brings valuable insight into project management, area amenity, obsolescence, benefits of location, traffic conditions and access.
In a perfect world this would not be necessary, if realty agents always disclosed every detail. That will never happen because the agent has a duty to their clients, which means they should not be advertising every last negative condition. This is why a buyers side representative is in place to assist in comprehensive review before submitting a contract. The appraiser is last in line as the final check and balance.
The interest of better consumer protection is how the in person appraiser review requirement came about in the first place. Now we just hear about efficiency this, cost savings that, as an entire nations worth of citizen consumers are placed at elevated risk so commissioned based agents can achieve a higher sales retention rate. The popular line is save consumers time and money. The reality is committing to a mortgage loan is most often the longest and largest financial commitment people make in there entire lives. The process should take longer.
We should be talking about increasing minimum standards for optimal performance and inhibiting the demands for extra expedient service as the status quo. Demanding 24/48 hour turn times, allowing runners, pdc’s, and typist outsources, forgoing in person review, those are all anti consumer safety positions people should reconsider their support of. Faster cheaper faster cheaper. And now there is a whip at appraisers backs all day long, we’re being ‘modernized’ out of existence, consumers have fewer safeguards, national housing over valuation has taken strong root in corelation with an ongoing affordability crisis. Be careful what you wish for.
Im so tired of amateurs claiming ‘driving the comps’ is inefficient or a waste of time.
Clearly they haven’t a clue as to what specifically they are supposed to be looking for.
Yet they continue to undermine our profession with short sighted, poorly informed suggestions.
Totally agree. Inspecting the comparables is part of the adventure outside of the office cubicle. There is so much additional information in just looking at the actual sale comparable and look at it from the buyers and sellers perspective as to , Did this Sale make sense in the market place ?
1 year and 10 months.
That’s all the time I have left in the appraiser profession (or what used to be a profession). It was a good run.
You’re going to become an order taker filling out a program……JUST LIKE Turbo Tax over the next 2 years.
It sounds like 65% of you are retiring. Be sure to immediately drag your corpse to the appraiser bone yard (regardless if you chose to work in a more profitable business). Contributors on this web site are well known for bashing anyone who leaves this WORTHLESS flea bitten JOB.
The appraiser must be able to anticipate what data gathering is necessary. That is why there are different forms for different housing types, creating a pre established framework. Such a concept was based on intelligent design. There must be zero confusion about what data the appraiser will need to gather ahead of time. If we can’t print out the form on paper ahead of the inspection the concept will not work properly in the real world.
Was shopping at Costco yesterday and they had this standard ice cooler, but this one had two giant speakers on the front. We laughed at the idea and were making fun of the all in one concept. Who’s really sitting around complaining about, I’m lugging this big old radio, and this big old cooler around, this is just too much. I wish someone out there would magically combine the two. The product is a novelty, someones bright idea of the day.
All in one is not a serious concept for all complex applications. In order to gain efficiencies, is why we compartmentalize and sort ahead of time. Show me one single appraiser anywhere who’s complaining about; Why does this have to be so complex, all these different forms to choose from? Someone should step in and magically make them all one single form together because it’s simply too difficult for me to make this choice.
Somewhat off topic. Never understood why regular condos and site condos do not have separate appraisal forms. It is very awkward to put a site condo on a condo form. At least in our area site condo lots function very similar to traditionally platted development lots. Both have identifiable lots. Whereas regular condos do not typically. All the land is common area for regular condos. Many of the residents do not know or care about whether they have a platted lot or site condo. Also, regular condo projects have issues with financing if a certain percentage is not owner-occupied. In our area site condos and regular condos function as different animals. My experience includes appraising proposed: plats, site condos, and regular condos; as well as foreclosures and workouts related to these property types. Also, our office has appraised individual properties in each property type.