Fannie Mae and Freddie Mac introduced additional steps to the appraisal process effective on May 1st. Some of the new steps include:
- Appraisers cannot communicate directly with lenders. The appraisal process must involve a third-party, such as an appraisal management company, to act as a go-between for appraisers and other parties, which increases the time to complete the appraisal
- Under the old rules appraisers could evaluate just three comparable sold properties. Now, they must also evaluate at least two properties that are currently under contract or are active listings
- Under the old rules appraisers could go back up to six months to find the three comparable sold properties. Now, at least two of the sold properties must have been sold in the past 90 days
- Appraisers must fill out a "market conditions" report that reviews the market trends over the past 12 months, broken down into the most recent three months, the prior three months, and then the first six months of the period.
With these new rules that are in place, it will take longer to complete appraisal reports due to the greater requirements set on appraisers. This is according to Cathy Miles of Appraisal Dimensions in Fort Collins.