Enactment of ML 2009-28 (Appraiser Independence) will be implemented February 15, 2010.
ML 2009-28 (originally planned for a January 1, 2010 implementation) has two parts: a) prohibition of mortgage brokers and commission-based lender staff from the appraisal process, and b) appraiser selection in FHA Connection. The effective date for both sections of this guidance will take effect for all case numbers assigned on or after February 15, 2010.
ML 2009-28 has several new requirements that include:
- Prohibition of mortgage brokers and commission based lender staff from the appraisal process.
- FHA does not require the use of AMCs or other third party organizations for appraisal ordering.
- FHA Roster appraisers are compensated at a rate that is customary and reasonable for appraisal services performed in the market area of the property being appraised.
- The fee for the actual completion of an FHA appraisal may not include a fee for management of the appraisal process or any activity other than the performance of the appraisal.
The letter also affirmed existing requirements that included:
- Withholding or threatening to withhold future business for an appraiser, or demoting or terminating or threatening to demote or terminate an appraiser.
- Requesting that an appraiser provide an estimated, predetermined or desired valuation in an appraisal report prior to the completion of the appraisal report.
- Providing to the appraiser an anticipated, estimated, encouraged or desired value for a subject property or a proposed or target amount to be loaned to the borrower, except that a copy of the sales contract for purchase must be provided.
The entire mortgagee letter can be found at HUD.gov.
Did you notice, FHA does not require the use of AMCs or other third party organizations for appraisal ordering.
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