Temporary Appraisal Requirement Flexibilities
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 from your local community, state or federal regarding travel and shelter-in-place.
FHFA Directs Enterprises to Grant Flexibilities for Appraisal and Employment Verifications – News Release 3/20/20
“… Federal Housing Finance Agency (FHFA) directed Fannie Mae and Freddie Mac (the Enterprises) to provide alternative flexibilities to satisfy appraisal requirements.”
“To allow for homes to be bought, sold, and refinanced as our nation deals with the challenges of the coronavirus, the Enterprises will leverage appraisal alternatives to reduce the need for appraisers to inspect the interior of a home for eligible mortgages.”
Appraisers NOTE: Both the GSE’s are requiring an entry in the ‘Map Reference’ field on the form to show whether the report is for an “exterior” or a “desktop.” Read the instructions in the Lender Letter and Bulletin.
Also, I have included LEGAL length revised SOW, Assumptions & Limiting Conditions, etc. in PDF format below. Print those and read them! These apply to both GSE’s.
These revisions should be included in report AHEAD OF THE FIRST GSE FORM PAGE, so that readers see this before getting into the report, when doing client directed reports with the COVID-19 modifications.
Freddie’s appraisal waiver allowance is different from Fannie’s.
I recommend that you open the links above and PRINT the Lender Letter and the Bulletin in its entirety. There are instructions for the forms to be used, how they are to be used, plus required comments to be used when doing either ‘exterior-only’ or ‘desktop’ assignments using the various GSE forms.
The Lender Letter and the Bulletin provide information about the following:
- Temporary appraisal requirement flexibilities: allowing exterior-only inspection appraisals or desktop appraisals
- Desktop appraisals: allowing for purchase transactions when an interior and exterior appraisal is not available
- Exterior-only inspection appraisals: allowing for purchase and refinances of Fannie Mae-owned loans
- Revisions to the scope of work, statements of assumptions and limited conditions, and appraiser’s certifications: requiring modified language to be used with exterior-only and desktop appraisals
- Additional form instructions for appraisals: requiring identification of “exterior” or “desktop” on the interior and exterior reports
- Appraisal waivers: encouraging lenders to accept waiver offers when eligible
- Completion reports (Form 1004D): allowing alternatives when a Form 1004D cannot be obtained