By Stacy Yost
Did you know that appraisers are monitored by FNMA?
Today, I’d like to highlight the plight of the appraisal world. An appraisal is used to judge the property’s acceptability for the mortgage loan requested in view of its value and marketability. As a lender we rely on appraisers to provide thorough, accurate, and objective appraisal reports that result in reliable opinions of market value so our underwriters can make prudent underwriting decisions.
FNMA keeps a database of home values, from which it regularly monitors appraisals from all areas. The way this monitoring system works, is that the Fannie program will flag potential errors in the appraiser’s evaluation before the lender commits to fund the loan. It will also score the appraisal for overall risk of inaccuracy. And finally, it can provide as many as 20 alternative comps.
If an appraisal comes across their desk that falls out of the home value parameters that has been set, it sends up a red flag and FNMA can decline to lend on that mortgage transaction, due to the excessive value of the appraisal. As you all can guess, with our housing market on fire – and offers coming in well above asking price, some situations have arisen where FNMA has become the issue on the loan which can cause delays. However, using this information from Fannie, mortgage lenders like us will be able to question the appraiser or management company that hired the appraiser, and possibly demand changes to the initial appraisal.
This is where good communication with your lender is key. Our team at Aspire Mortgage Group is here for you and will help every step of the way.