Getting Up to Speed with Fannie's New 1004MC

Fannie Mae has introduced the addendum 1004MC and is requiring its use beginning April 1, 2009 (view the form at It is a worksheet to help appraisers perform a market conditions analysis (MCA). By the time this hits your desk you should have begun the process of becoming familiar with it. Here is some help getting up to speed.

The appraisal profession is accepting this new form with its usual manner- much like a deer frozen in the oncoming headlights of an automobile. Many appraisers find themselves confused about their responsibilities resulting in a general state of apprehension. The proactive appraisers who have already looked at the addendum may find that they are weak in the methodologies and techniques associated with a MCA.

You may feel you are off the hook for data such as “listings,” as you cannot directly search your MLS for the number of active listings on the market as of six months ago, but you do have the data available to provide this information. This data exists in the on-market, off-market, and days-on-market dates in the listings, solds, expired, withdrawn, etc.

You may have noted that if you tackle this addendum by printing out 30 to 70 hard copies of MLS sheets and begin hand sifting for data and tallying with a calculator, the addendum will literally take hours to complete. You may have reached the point that you feel you cannot master what should be a simple process even after the addendum lays it out step by step. The purpose of this writing is to provide some fundamental perspectives on the process of performing a MCA that you can expand and build on, as well as to convey what the appraiser must do to become proficient in performing a MCA.

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