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Fannie Sel-2016-09 Dec 6 2016

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Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
December 6, 2016




Announcement SEL-2016-09

The Fannie Mae Selling Guide has been updated with the following changes:

  • Includes information on asset and employment validation offered through the Desktop Underwriter® (DU®) validation service starting on December 10, 2016.
  • Introduces freedom from reps and warrants on property value for loans with a Collateral Underwriter® risk score of 2.5 or lower effective December 10, 2016.
  • Removes the Property Inspection Waiver fee for loans delivered to Fannie Mae on or after January 1, 2017. The fee for the DU Refi Plus™ Property Fieldwork Waiver is also discontinued for loans delivered on or after January 1, 2017.
  • Clarifies when lenders must update appraisers of changes to a sales contract.
  • And more.
You can read about these and other miscellaneous updates in Selling Guide Announcement SEL-2016-09.

For a summary of key updates in this Selling Guide Announcement, view the executive perspectives video presented by Jude Landis, Vice President, Credit Policy, and/or the executive overview provided by Carlos Perez, Chief Credit Officer for Single Family.
 

DWiley

Elite Member
Joined
Apr 4, 2007
Professional Status
Certified Residential Appraiser
State
Tennessee
Thanks, Mike. The section on Disclosure of Information to Appraisers could be VERY good news for appraisers. I will certainly be communicating that Fannie position to all the lenders I work with.
 

Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
Very welcome Danny. I agree.
 

TRESinc

Elite Member
Joined
Dec 1, 2011
Professional Status
Licensed Appraiser
State
Ohio
Contract Changes After the Appraisal is Completed

If the contract is amended after the effective date of the appraisal in a way that does not affect the description of the property, then the lender is not required to provide the amended contract to the appraiser nor obtain a revised appraisal. Some examples of amendments that do not require the lender to provide the amended contract nor obtain revisions to the already-completed appraisal report include:

• sale price,
• transaction terms,
• financing concessions,
• seller-paid closing costs,
• names or initials,
• closing date, and
• correction of minor clerical errors such as misspellings

love this change! always hated lenders asking me to go back and change the contract section weeks after completion
 

Non Sequitur

Elite Member
Supporting Member
Joined
Feb 14, 2002
Professional Status
Certified Residential Appraiser
State
Louisiana
love this change! always hated lenders asking me to go back and change the contract section weeks after completion
I agree, but I doubt lenders will follow this. There's plenty of mumbo-jumbo lender and AMC "guidelines" that aren't required by USPAP or Fannie/Freddie but are blamed on Fannie/Freddie.

I don't expect lenders will change their internal processes for this, the safest bet is to still send the changes on and make the appraiser deal with it. Heck, if I were a lender that's what I would do. In the event of a buy back I don't want to see a "well that's what we wrote but in this case you should have sent it down the line" from Fannie.
 

TRESinc

Elite Member
Joined
Dec 1, 2011
Professional Status
Licensed Appraiser
State
Ohio
I agree, but I doubt lenders will follow this. There's plenty of mumbo-jumbo lender and AMC "guidelines" that aren't required by USPAP or Fannie/Freddie but are blamed on Fannie/Freddie.

I don't expect lenders will change their internal processes for this, the safest bet is to still send the changes on and make the appraiser deal with it. Heck, if I were a lender that's what I would do. In the event of a buy back I don't want to see a "well that's what we wrote but in this case you should have sent it down the line" from Fannie.

ya, that's what i fear too. i did however already send the entire appraiser/contract changes section from the announcement to all my conventional lending clients. maybe i will get lucky...
 

DWiley

Elite Member
Joined
Apr 4, 2007
Professional Status
Certified Residential Appraiser
State
Tennessee
ya, that's what i fear too. i did however already send the entire appraiser/contract changes section from the announcement to all my conventional lending clients. maybe i will get lucky...
I prepared a one page summary with the info from the Announcement and the Selling Guide as well as links to both documents. Fingers crossed. :)
 

Wayne Valliere

Freshman Member
Joined
May 13, 2005
Professional Status
Certified Residential Appraiser
State
Massachusetts
December 6, 2016




Announcement SEL-2016-09

The Fannie Mae Selling Guide has been updated with the following changes:

  • Includes information on asset and employment validation offered through the Desktop Underwriter® (DU®) validation service starting on December 10, 2016.
  • Introduces freedom from reps and warrants on property value for loans with a Collateral Underwriter® risk score of 2.5 or lower effective December 10, 2016.
  • Removes the Property Inspection Waiver fee for loans delivered to Fannie Mae on or after January 1, 2017. The fee for the DU Refi Plus™ Property Fieldwork Waiver is also discontinued for loans delivered on or after January 1, 2017.
  • Clarifies when lenders must update appraisers of changes to a sales contract.
  • And more.
You can read about these and other miscellaneous updates in Selling Guide Announcement SEL-2016-09.

For a summary of key updates in this Selling Guide Announcement, view the executive perspectives video presented by Jude Landis, Vice President, Credit Policy, and/or the executive overview provided by Carlos Perez, Chief Credit Officer for Single Family.
All that is necessary now is getting all the Gov. Agencies together and determine the meaning of the word "upgrade".
 

Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
"With this update, we have clarified when the appraiser must be provided with updates to the sales contract and circumstances that warrant updates to the appraisal. For example, if the contract is amended in a way that affects the description of the real property used by the appraiser, then the lender must provide the updated contract to the appraiser and the appraisal should be updated. However, minor updates to the contract, such as changes to seller paid closing costs or changes to the contract price, do not require an updated appraisal."

they finally recognized, PUBLICLY, that >> "changes" to the bull$eye contract price are irrelevant.

A first step in the right direction - they almost got it right.

re: requirements for Appraiser Independence and Objectivity; whether a home equity, refi, or purchase appraisal assignment - a statement on the intended use/ purpose of the appraisal report "mortgage finance transaction" suffices.


Review of a subjective specific contract is not necessary as "Market Value" reflects the actions of OTHER sellers and buyers of OTHER directly competitive properties based on the Principle of Substitution. Whether a subject's property is under a MUTABLE contract agreement - is irrelevant to the Appraiser.

It IS relevant to Lender's Underwriters, sellers, buyers, re agents and commissioned loan originators.


1. Let Underwriters underwrite (analysis between contract and appraisal reports OVM) AND

2. LET APPRAISERS INDEPENDENTLY AND OBJECTIVELY - APPRAISE .
 
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