Understanding FHA Appraisal Compliance

FHA Appraisal Compliance is right around the corner FHA has made it very clear that they will not tolerate any lenders who do not comply 100% with FHA‘s regulation.

Gaithersburg, MD - February 12, 2010 -- The key to success with the new appraisal changes is understanding what needs to be done and how to effectively manage the new appraisal process. FHA sent an announcement several months ago but has not provided very much follow-up or detailed as to exactly what needs to happen for a mortgage lender to be compliant with the upcoming changes

As of Feb 15, 2010 FHA Appraisal Regulations will do the following:
* Prohibits Loan Production Staff or anyone compensated with the closing of a loan from ordering an appraisal for both Conventional and FHA.
* FHA Stresses “Absolute lines of independence” “Any lender who refuses to follow FHA requirements will simply no longer enjoy the privilege of participating in FHA programs” Dave Stevens
* Lenders will get sanctioned if appraisers names is not correct in FHA Connection. Appraisal on report must be the same in connection
* Timely Payment to appraisers (net 30).
* The appraiser will enjoy the freedom from any person to Provide ANY Estimate of value on the appraisal request verbally or e-mail.
* Established Appraiser Independence Hot-line.
* Provide appraiser written notice of a removal from a list or for any reduction of work.
* Forbid‘s lender from ordering a second appraisal without putting both in the loan file.
* FHA prohibits “appraiser shopping” where lenders order more appraisals to assure :

the highest possible value for the property
and/or the least amount of deficiencies
and/or repairs are noted and required by the appraiser.
However, a second appraisal may be ordered by the second lender under the following limited circumstances:

1. The first appraisal contains material deficiencies as determined by the Direct Endorsement underwriter for the second lender.

2. The appraiser performing the first appraisal is on the second lender‘s exclusionary list of appraisers.

3. Failure of the first lender to give a copy of the appraisal to the second lender in a timely manner would cause a delay in closing, posing potential harm to the borrower.

* In cases where a borrower has switched lenders, the first lender must, at the borrower‘s request, transfer the case to the second lender. FHA does not need that the client name on the appraisal be changed when it is transferred to another lender.

Still not 100% sure what to do?
We would be happy to help you. e-mail [email protected]

About Coester Appraisal Group:
Headquartered in Gaithersburg, Maryland, Coester Appraisal group has provided quality real estate appraisals since 1970. Clients that depend on Coester‘s appraisals, BPO‘s, AVM‘s and property valuation tools include banks, credit unions, mortgage companies, hedge funds, attorneys and government agencies. Their experienced staff provides a quality valuation completed in a timely manner with a correct estimation of market value. Each appraisal is manually reviewed by a staff appraiser for quality and compliance with lender‘s underwriter guidance and is certified HVCC and USPAP compliant. For more information about the company and its services, please visit their website at http://www.coesterappraisals.com.

Contact:
Brian Coester
Coester Appraisal Group
Gaithersburg, MD
(888) 485 - 1999 ext 2
[email protected]
http://www.coesterappraisals.com
http://www.appraisalnewscast.com