Realtors, mortgage brokers push for delay in new appraisal rules


NEW YORK – April 28, 2009 – New real estate appraisal rules will be implemented on May 1 by Fannie Mae and Freddie Mac in accordance with a 2008 agreement with New York Attorney General Andrew Cuomo to reduce collusion and fraud in the appraisal industry.

The new code of conduct will force lenders to order valuations through third-party appraisal management companies, and those with in-house appraisers are required to institute policies to prevent loan officers from attempting to influence appraisers.

Additionally, mortgage brokers will need to go to lenders to order appraisals. The National Association of Realtors is calling for a one-year moratorium on the rules and, along with other industry trade groups, is contending that minimal guidance from Fannie Mae and Freddie Mac means most lenders have not had a chance to upgrade their computer systems.

Industry representatives worry that the new rules will boost costs for borrowers, as lenders can be forced by Fannie Mae and Freddie Mac to repurchase mortgages and additional appraisals could be necessary if borrowers are shopping different lenders to obtain the best rate.

For more information about the new appraisal rules, go to NAR’s Web site at: http://www.realtor.org/government_affairs/gapublic/appraisal_cuomo_gse

Source: Wall Street Journal (04/27/09) Holzer, Jessica

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