This past week has been fairly interesting on the CU front. It looks like Fannie Mae got our message! They issued a Collateral Underwriter FAQ (frequently asked questions) dated February 2015. In it are several noteworthy items.
Fannie Mae has updated the description and purpose of CU to make it clear that is only a support tool, not a primary appraisal review tool:
Fannie Mae now acknowledges that lenders need training and are proactively reaching out:
They have provided clear usage guidelines:
Fannie Mae makes it clear that the lenders are responsible for human due diligence:
So what does this mean for Realtors or Homeowners?
This is definitely good news! There has already been a dramatic decrease in the amount of deal-killing busy work generated by automated CU flags/messages that were being automatically passed along to the appraiser. I have seen the results of this FAQ first hand, with at least ten lender appraisals delivered since the FAQ was published and not one CU message to respond to! This means that appraisers are again free to do their job properly, without undue influence. Will there still be questions based on CU generated flag? Sure! But they should be few and far between and serve as a constructive basis for a discussion about unusual or atypical properties (aka: outliers). It may also serve to weed out a few ‘bad apples’ in the appraiser ranks.
A big THANK YOU to the following for getting the word out and helping to Slay the CU Dragon!
- NAR – http://www.realtor.org/articles/fannie-mae-s-new-appraisal-risk-assessment-tool-collateral-underwriter-cu
- Ryan Lundquist – http://sacramentoappraisalblog.com/2015/01/20/what-you-need-to-know-about-fannie-maes-collateral-underwriter/
- Appraiser Coalition – https://www.appraisalbuzz.com/network-state-appraisal-organizations-letter-fhfa-director-watt-fannie-mae-collateral-underwriter-program/
- Frank and Brian at the National Real Estate Post – http://thenationalrealestatepost.com/fannie-speaks-out-on-new-cu-appraisal-software/
- Anne O’Rourke – http://appraisaltodayblog.com/author/annorourke/
- Phil Crawford – http://www.voiceofappraisal.com/
Turner’s Appraisal Services helps people make informed property valuation decisions by providing easy to understand yet comprehensive real estate appraisal reports. I am IRS Qualified and a California State Certified Real Estate Appraiser with local expertise in the Los Angeles neighborhoods. To discuss Los Angeles Area property values please feel free to call me anytime.
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