Fannie Mae's "Do Not Use" List

WRE, Working RE Magazine, Appraiser News, Appraiser Magazine, Real Estate Appraisers, Volume 33
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Editor’s Note: The following is the Publisher’s Note from the upcoming print magazine. The magazine will begin mailing in a few weeks, keep an eye out for it! Am I a Subscriber?

Fannie Mae’s “Do Not Use” List
by David Brauner, Editor

Perhaps the biggest news for residential real estate appraisers this quarter is the introduction of Fannie Mae’s Appraiser Quality Monitoring (AQM) system, made possible by the mandated collection of appraisers’ data via the UAD, over the last two years. Call it what you will, AQM is a “do not use” list for appraisers. Now, isn’t that a kick in the pants? (For more details and to view a AQM FAQs,please click here).

The stated goal of the Uniform Appraisal Dataset (UAD) is to standardize appraisal data for better quality appraisals and a smoother loan process. Many appraisers agree wholeheartedly with Fannie’s recent move; “subpar” appraisers should be either rehabilitated or run of business, they believe, and the “do not use” idea by Fannie suits them just fine. And Fannie Mae and Freddie Mac are feeling the heat. Consider the recent report from the Federal Housing Finance Agency’s Office of the Inspector General, which gives the GSEs low marks for “failing to fully analyze data from the Uniform Collateral Data Portal and continuing to take unnecessary risks when purchasing and guaranteeing single-family residential mortgages.” Ouch.

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OREP Appraiser E&O Insurance

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Others don’t believe the data grab is about improving quality at all; to them the forced collection of data is aimed at replacing appraisers rather than improving their product. Who knows?

Maybe it’s the contrarian in me that makes the following comment from a WRE reader one of the most insightful I’ve seen on the subject. In response to the story Fannie Puts Appraisals Under Microscope, this appraiser writes, “I would like to ask Fannie Mae when they will start making available to appraisers, at no cost, access to the accumulated data, so that appraisers can provide better appraisal reports with better analysis and support for individual adjustment factors. The data should be made available to appraisers at no cost since we are the ones who supplied it. All real estate-related industries should be trying to make that happen. We all have an interest in trying to improve the accuracy of appraisal reports.”

While his inquiry is fair and respectful, I don’t expect this appraiser is waiting for a response from Fannie Mae any time soon. And maybe that’s the problem.

If you want to better understand what Fannie Mae is doing and how to keep yourself off its “do not use” list, Richard Hagar, SRA offers his considerable knowledge and best advice in the webinar Keeping Off Fannie Mae’s New Appraiser “Black List.” In it, Hagar explains what he terms are Fannie Mae’s new “Black, White and Gray lists,” the kind of issues that will raise red flags and what happens then (details below).

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AMC Resource Guide

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Related OREP/WRE Webinars

Keeping off Fannie Mae’s New Appraiser “Black List”
Available for Download Now – Watch at Your Own Convenience
This webinar is designed to keep appraisers trouble-free. It describes the new AQM process and what to expect from Fannie Mae (FNMA). Richard Hagar, SRA, national authority on lending and appraisal guidelines, provides an overview of how the system works, what it reports to lenders and what it takes to get an appraiser on the “bad boy” list.

Appraiser Liability and Independence: How to Protect Yourself
ATTEND LIVE: March 18, 10 – 11 a.m. Pacific Time
In the this new environment, when an appraisal doesn’t “meet value,” appraisers can face pressure and harassment from borrowers, home owners, real estate agents, AMCs, lenders, and the list goes on! Protect yourself by learning a few simple techniques on staying out of trouble and standing up for your rights as an appraiser.

We’re always listening: Send your story submission/idea to the Editor:

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Comments (5)

  1. by

    In ten years there will be no need for state boards.
    There will no residential appraisers left.
    Every time state boards hand out meaningless discipline for the
    stupidest infractions, you need do to 100 more appraisals
    to pay for the increase in your E&O premium.
    The AMCs do not adhere to USPAP.

    - Reply
  2. by Clarence F. Schaub, RAA

    So what do you think will happen now that Fannie Mae & Freddy are just using the UAD
    to pepare a computer generated appraisal. They are eliminating many suported ajustments like the difference between a 700 sq ft 2 car garage and a 380 sf 2car garage or a house that falls between a Q3 an a Q4 that is being updated with only partially completed remodeling or preparing a generic and inaccurate appraisal. Obama has made the decison for you by getting rid of both of them so they will disappear and the changes will remain and the appraiser will be eliminated just given it a little more time.
    If you find this as a good move for the appraiser profession print it.

    - Reply
  3. Appraisers are a dying breed. The avg. age of the appraiser’s in my state is 62 yrs. of age. With the continued slaughter to the appraisers ability to gain a client, bill per hour as most professions due & set their fee’s, grow a repeat business & reputation, add on higher than ever state & federal qualifications, the cost to due business……The onset of AMC’s, regulating the wrong people, (Loan originators), this is just another huge nail in the coffin of the appraiser. In the pyramid the banks are at the top & the appraiser is way down at the bottom. There is master plan & it does not include the appraiser. We area a cog in their wheel.

    - Reply
  4. Black lists, illegal if lenders do it, OK if FNMA does it. It’s just another way to destroy the appraisal industry and punish appraisers for doing their jobs correctly. The people put on this list will probably be the best appraisers in the US, while the scumbags will continue to just do what they do. Don’t believe me? Just watch what happens.

    - Reply
  5. by

    Did anyone think that UAD was a good thing?
    If you do, you better get tested!
    UAD is nothing more than “data mining”.
    Just another mouse trap levied on appraisers.

    - Reply

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