Notice dated 10/24/16. I suspected that this was where Fannie was going with UAD and CU.

Refis only.. for now. $75 to waive the appraisal requirement.

Fannie has been testing it for quite awhile with some lenders. You may see this referred to as “Day 1 Certainty”, the name Fannie has chosen. They are also waiving reps and warranties (buy backs) so it will be very popular.

Thanks to Dave Towne for this very interesting news!

My comment: I will have an article n this topic for my November newsletter, out November 1, including what this means for you plus lots more details. I have read all the documents, going back to a newspaper article in as 2002. Very interesting.
  1. I intend to blow the whistle on this idiotic move by the GSEs at the Las Vegas Valuation Expo in 10/2017. I will call for the creation of a nationwide real estate appraiser union or at the least, a coalition. The more of us that unite, the more we can accomplish.

    • Why has is taken so to get to this point and the appraisers as a whole do not seem to show any enitiative to actually band together? Why don’t appraisers understand by grouping together we can actually put up a fight for our independence and not have FNME dictate what will or wil not happen with/to our profession?

  2. I would guess that with their 20 million appraisals, that Fannie Mae is using Copyrighted data, not found in public records, but developed by the appraiser. Appraisers are not being compensated, and Fannie is not above the law. We need some good Whistle blowers. Whistle blowers can make some good money for getting the truth out.

  3. In my market appraisers get together to discuss issues that impact our business and since the advent of HVCC I have been “Chicken Little” saying we were being asked to cut our own throats by having all appraisals be so uniform in all respects so they could be data mined. When Fannie Mae indicated before implementing CU that they had over 20 million appraisal reports I saw this as the beginning of the end for residential appraisers. I believe that as technology advances and the algorithms improve, there will be a call to do away with residential reports except for unique properties for which there is not much data available. The sky may not be falling just yet, but, I think it’s time to start looking for falling objects.

  4. This has been around for a few years. Only the crème de-la crème credit scores, and low LTV loans will be offered this program. Let’s face it, there are some appraisals that you have done that were a waste of time because the LTV was so low. This minuscule number of “lost” appraisal orders will not hurt the appraiser. However, just like the old 2055 drive by and the DU that waived appraisals prior to the bubble bursting – they will only wake up after the damage is done and find a way to blame the appraiser again!

  5. Well, when the profit for bundling bad loans on the secondary market is 5%, then the repack and purchase of the loans to fail is 20%, they had to do something to recreate the profit margins again. There is simply too much money left on the scummy table. Hey, just don’t tell anyone what the house is actually worth, so when it goes south (which it will) then it will go further than last time. I’m hoping that the government will not bail out FNME this time and let it sink – force the banks and investors to think about the money they are investing in and be happy with the idea that it takes 30 years to get the money back and not have the attitude that the owner payoff half, foreclose on it and then resell it at a greater profit.

    • I agree with you. The Banks put the property on the market for a low ball price with NO appraisal, sell it fast, then go after the owner for the difference. Currently, they are also trying to hold prices down for a better cushion. I have seen the same foreclosures sold year after year, for the same price. As soon as appraisals and selling prices start going UP, the lenders are all whining and warn of a crash. I don’t hear people talking doom and gloom when the stock market does the same thing. Real estate has always been as good as stocks, and we need to get prices back up where they belong.

      • In the NW the prices are sky high again with steady slow steady increase YTD, so that is not an issue here. I know there are going to be many lender pleased as punch over this – but I also know it is just going to increase the foreclosures all over. Many lenders are running this discussting second mortgage on day one of a new purchase….is that NOT a form of sub-prime lending? Where did the resetrictions go that were suppose to stop it? Then you have a presidential nominee that wants to do away with FIREEA….so much to checks and balances with a fair market. It will be liking going back to old days before appraisals existed…

  6. Why is this not redlining.

  7. Just remember how fast the Iraqi National Bank and the Iraqi National Museum was looted clean – about 24 hours is all it took. The looters will clean out FNMA in a heart beat on this foolish program with no appraiser E & O insurance and no buy back provision. Taxpayers will have to bail out the losses once again.

  8. There have always been a certain percentage of loans that don’t require an appraisal. Wondering what percentage of loans would be eligible for this.


  10. Its disappointing but not unexpected. We all asked and were assured that this data collection had nothing to do with eliminating the appraiser and their services. What amazes me is the attitude that Fannie Mae has in owning the data collected by the appraiser from their paid data services. There is no mention of the value of that information to Fannie Mae or how they should compensate the appraiser data intended to profit beyond the loan for which the appraisal report was engaged. I don’t remember the appraiser being told they could share the data with non-MLS members beyond its necessary information in an appraisal assignment. Now all of a sudden with the magic of a computer formula there will be loans made based on data that was never intended for that use. Sit back appraisers, for a while anyway. It will take a bit of time, maybe a couple of years or more,then when the foreclosures hit and there is no appraisal report to find deficiency it will be on the secondary market’s shoulders. Then again the appraiser will be called upon just as they were in the mid 1990’s when it became clear the evaluations performed by others outside of the appraiser profession did not protect the public interest when bad lending decisions were made. Appraisers were cattle prodded into the stall with the insistence of the UAD and then placed in a tight fitted coral now awaiting their mass execution with this new announcement to quickly provide meat on the shelves. At some point the public will figure it out; its not the machine that went to the site, lives and works in the area or even recognizes when an influence is either neutral, beneficial or adverse. Go for it R2CU; go for it. When it fails and you come back, a few of us will still be here and the price will be far more than what you’ve called today “reasonable and customary”.

    • I simply cannot believe anyone would make a loan on a property without having some kind of a appraisal.Have we not learned anything over the past 20 years.

    • Diana, you have it right. In the end fnma will get burned lending money on a dwelling with no interior inspection. The lenders fnma never learn from prior mistakes.

      • “..FNMA will get burned…” aka the U.S. consumer & taxpayer.

  11. I agree with Joseph. This is just the start of it. Eventually Fannie’s computer will produce a value and even if it’s wrong that’s the value the lender (and homeowner) will get. Estimates will be low and the market will come to a dead stop. Fannie’s database is wrong however because they complied data from appraisals, most of which are wrong. Oh! well, another government mess up.

  12. We all knew that CU was meant for something bad…for us appraisers. Once FannieMae begins doing loans without an appraisal, there will be no end in sight. Nails in the coffin of our profession.

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