As part of a continuing effort to ensure integrity in the relationship between lenders and appraisers, The Federal Housing Administration's (FHA) Appraiser Independence and Appraiser Engagement regulations are set to take effect January 1, 2010.
The new FHA guidelines are similar to the government-sponsored enterprises' (GSEs) Home Valuation Code of Conduct (HVCC). Under FHA's rules, appraisers are required to receive reasonable and customary compensation, and the administration has adopted higher standards in ordering appraisals. FHA's regulations mirror HVCC's requirement that appraisers cannot be affiliated with lending agencies and also requires appraisers to have familiarity, experience, and knowledge in the geographic location of the properties being appraised. In addition, the new regulations will impose changes in FHA case number procurement and management.
AprraiserLoft.com, an appraisal management company based in New York, said it strongly supports the agency's new valuation rule set to take effect in the New Year. The company's practices were already in full compliance with the new FHA regulations when HUD released them in October 2009, and AppraiserLoft said it will maintain its commitment to maintaining integrity and delivering professional, unbiased appraisals.
""The company will continue to exceed expectations as it ensures that all transactions are performed at an arm's length, without any influences or relationships which could impact the true valuation of properties we are trusted to appraise honestly and independently,"" said Brad Kirk, AppraiserLoft's director of national sales.
With over 15,000 appraisers, AppraiserLoft's nationwide network includes FHA approved appraisers in all 50 states. This, the company said, ensures that AppraiserLoft fulfills the new FHA requirement that appraisers have familiarity, experience, and knowledge in the geographic location of the properties they appraise.
""Geographic location has always been and will always be one of the main criteria for the selection of independent appraisers in AppraiserLoft's transactions,"" said Shane Copeland, SVP and director of national sales. ""We strongly support and will continue our previous practice of hiring local appraisers to provide property valuations that lenders can trust.""
While the new rules regarding FHA case number procurement and management are necessary, AppraiserLoft said these strict regulations have the potential to delay the appraisal ordering process. To combat this, the company said it is internally prepared to expedite the process and reduce inefficiencies, while continuing its commitment to generating quick turnaround times.
""AppraiserLoft applauds and supports the higher standards outlined in the FHA version of the HVCC,"" Kirk said. ""We welcome the opportunity to be leaders in complying with this legislation and have set forth policies and procedures which will help us to effectively do so.""