Real estate appraisers who provide valuation reports for loans insured by the Federal Housing Administration are now subject to revised regulations.
Previously, the policy of the Department of Housing and Urban Development was to require appraisers to be licensed in order to appear on FHA’s appraiser roster.
But the Housing and Economic Recovery Act of 2008 changed that requirement.
Appraisers must instead be certified by a state appraisal licensing board in the state where the property is located if they are to appear on the roster.
In addition, FHA appraisers must be able to verify that they have been educated about FHA appraisal requirements.
In a public filing Wednesday, HUD said that its current practices comply with the HERA requirement, but its regulations were outdated. HUD actually issued Mortgagee Letter 2008-39 in December 2008 that gave appraisers until October 2009 to comply.
So it proposed a rule in July that complies with the law. The proposal called for the replacement of obsolete references to the Credit Alert Interactive Voice Response System with references to the successor, online-based Credit Alert Verification Reporting System.
While HERA alternatively allowed the appraiser to be certified by a nationally recognized professional appraisal organization, HUD said it would not accept the professional organization alternative in order to prevent disruption because “state certification sufficiently accomplishes the statutory purpose of ensuring higher quality appraisals.”
No public comments on the proposal were received, so HUD is adopting final rule.
The effective date of the final rule is Dec. 23.
