Wednesday, August 31, 2011

Fannie & Freddie New Language for Appraisals

The secondary market, (Fannie and Freddie) have adopted new language for their appraisals. It is called the Uniform Appraisal Data Set. FHA has not adopted the same format.

The adoption begins in September as optional and mandatory for applications taken beginning in December of this year. Some of the changes are:

Style of home: Presently used 1 story, 1.5 story, etc. Fannie and Freddie now want architectural nature as style; such as: Colonial, Victorian, Rambler, Contemporary, etc.

In addition there are new abbreviations for view and 6 different condition ratings (C1-C6) and 12 quality ratings (Q1-Q12) and every home is to have statements of either “not updated” or “updated” or “Remodeled” .

These underwriting changes affect all lenders, REALTORS® and appraisers. The MLS will have to be adjusted to accommodate these changes and the agents will need to know how to correctly determine the changes in style and the different ratings that will apply when taking listings.