FHFA’s Oversight of Fannie Mae and Freddie Mac’s Use of Appraisal Data

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On February 6, 2014 the Federal Housing Finance Agency (FHFA) issued an interesting synopsis of the Office of Inspector General’s audit. The synopsis covers the FHFA’s oversight of Fannie Mae and Freddie Mac’s (GSE’s) use of the UCDP to analyze appraisal data, prepurchase, to improve loan quality and reduce risk. You can access the synopsis by clicking here.

Based on the audit findings and associated recommendations, it is fully expected that both GSE’s will continue to convert UCDP “warnings” to “fatal edits.” Additionally, the GSE’s will use UCDP data to monitor appraiser licensing, activity and quality of work product. The December 10, 2013 release of Fannie Mae Lender Letter LL-2013-10 and the joint February 11, 2014 Uniform Collateral Data Portal Release Notification and Uniform Appraisal Dataset Update certainly indicate that such steps are already being taken by the GSE’s to meet the objectives of the 2010 FHFA directive to use appraisal data to minimize the risk of losses on single-family mortgages.

Valuation Management Group encourages lenders originating single-family mortgages to be sold to the GSE’s to ensure their AMC or appraisal department is addressing and clearing UCDP warnings and appropriately monitoring their appraiser panel. VMG addresses and clears warnings for our clients and have offered this value added service since the inception of the UCDP.

Valuation Management Group is a national, full service appraisal management company that manages the appraisal process for community banks, mortgage bankers and credit unions. We take the process from ordinary to extraordinary.

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