Can appraisals shield lenders from buybacks?

Can appraisals shield lenders from buybacks?

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They can if the appraisal conforms to criteria recently outlined by Fannie Mae. Beginning December 10, 2016, lenders using Fannie Mae’s Collateral Underwriter® (CU™) tool will receive representation and warranty relief for the appraised value on properties with qualifying scores of 2.5 or lower. This major risk-lowering benefit is coming as part of Fannie Mae’s Day 1 Certainty Program.

The CU tool, one part of the Day 1 Certainty™ Program, provides an automated risk assessment of an appraisal report to support proactive management of appraisal quality, helping lenders evaluate risk at the beginning of the loan process while enabling an improved borrower experience.

Accurate Group has been using CU as part of its overall appraisal review process for several years, as part of our effort to help lenders reduce revision rates and ensure appraisal quality. Other lender benefits of the CU tool include:

  • Quality – appraisals segmented by risk profile
  • Efficiency – 22 hard-stop messages to reduce turn time
  • Speed – immediate feedback in the Uniform Collateral Data Portal® (UCDP®)
  • Analytics – model-derived results based on market specifics
  • Collaborative – interactive functionality including comps, aerial mapping, market trends & conditions, public records and more
  • Transparency – Lenders access the same patented tool used in Fannie Mae’s post-delivery QC so they can proactively identify and address appraisal defects prior to loan delivery

Full details on the Day 1 Certainty Program are summarized in a recent HousingWire article titled: “Fannie Mae announces sweeping program for mortgage lender “freedom” from penalties.

Are you ready to take full advantage of Fannie Mae’s Day 1 Certainty Program and the freedom from representations and warranties it brings to your business?

If managing your own appraisals is taking too much time and focus away from revenue-generating activities, consider outsourcing the day-to-day responsibility of appraisal management to Accurate Group. Our seamless technology and process integration to Fannie Mae’s CU tool and built-in interface with Fannie Mae’s Uniform Collateral Data Portal (UCDP) help ensure lender compliance, reduce appraisal revisions, and improve efficiency and turn times.

Contact Accurate Group today to learn more about our managed services platform and how it can positively impact your business.

Appraisal Tip of the Month (“TIP”) is a publication of Accurate Group, LLC and is intended to provide current insights to recipients. Tip should not be construed as legal advice or a legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only. You should not act or refrain from acting based upon any information in this TIP without seeking the appropriate legal or other professional advice on the particular facts of your situation. Accurate Group, LLC makes no warranty of any kind with respect to the subject matter included herein or the completeness or accuracy of this publication.

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