Changes are once again being made in the appraisal industry. Most recently, in hopes of enhancing appraisal data quality and consistency, Fannie Mae and Freddie Mac have created the Uniform Appraisal Dataset (UAD). Under the direction of the Federal Housing Finance Agency, the UAD will attempt to promote the collection of electronic appraisal data through what's called the UCDP(Uniform Collateral Data Portal). The appraisal report forms must now be in compliance with the new UAD for conventional mortgage loans sold to Freddie Mac and Fannie Mae and had an effective date (date of inspection) of September 1, 2011. The UAD will be a standard form for the VA and FHA as of January 1, 2012.
The forms included are as follows:
The UAD was put in place to standardize certain information to show consistency in appraisal reports, regardless of the location of the property. The UAD will also standardize certain information such as variations in the formatting of numbers, dates and measures; inconsistent terminology for the same information; and inconsistent uses of certain descriptions such as the quality of construction being described.
The following is a list of UAD standardizations:
With these standardizations in place, there seems to be positive improvement on the side of the lenders: They will have a better understanding of appraisal definitions as well as more confidence in the quality of the appraisal, and there will be more consistency and efficiency in appraisal reviews. This will likely streamline the loan process, making less room for errors and questions regarding content of the appraisals.
This may be a positive move for the lenders, but what does it mean for appraisers? We need to stay tuned in the coming months and see how it all plays out.