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AQM – Appraiser Quality Monitoring – Website Launched by Fannie Mae

New AQM WebsiteFannie Mae’s new Appraiser Quality Monitoring (AQM) was launched on January 6, 2014.  The AQM is a list compiled by Fannie Mae that identifies appraisers whose appraisals must either undergo 100% review or whose appraisals will no longer be accepted at all. The list is password protected content available to lenders on Fannie Mae’s website. It is scheduled to be updated by Fannie Mae on a monthly basis.

Data Collection

Fannie Mae began gathering appraisal data through the UCDP – Uniform Collateral Data Portal – in 2011. This data is now being used to monitor appraisals for accuracy and consistency. Appraisal monitoring begins with Fannie Mae conducting weekly cross-checks against the ACS’s – Appraisal Subcommittee – National Registry of appraisers. They check to see if an appraiser’s license or certification is current as of the date they submitted a given appraisal. If the appraiser is found not to be currently licensed or certified, the lender may be subject to a repurchase request. The next step is the confirmation of the appraisal data. When checking for inconsistencies, Fannie Mae signals multiple appraisals on a property and transaction by an appraiser that show discrepancies in the living area, sales price, room count, lot size and condition and quality rating. An appraiser’s appraisals may be flagged for review if, for example, they use a comp property on different reports and the property data differs between reports.

 

AQM Notifications and List Access

Messages informing lenders of review or refusal of an appraiser were added to the UCDP on December 10, 2013. The messages notify lenders that an appraiser’s appraisals are either subject to 100% review or are not being accepted at all by Fannie Mae.

The new AQM list is accessible by lenders. There are three possible ways they will find out if an appraiser has been selected for review or is subject to refusal:

  1. Lenders who have submitted an appraisal by an affected appraiser within the last year will receive direct notification from Fannie Mae
  2. Messaging within the UCDP will notify lenders when an appraisal from an affected appraiser is submitted
  3. Approved lenders can set up access to the AQM list in their business portal

AMCs – Appraisal Management Companies – will not be granted access to the full list, however lenders are allowed to inform AMCs of the presence or absence of a specific appraiser on the list. Likewise, appraisers will not be granted access to the full list but will be personally notified by Fannie if their appraisals are in question.

 

Possible Actions

Appraisers who show a pattern of minor inconsistencies in their appraisal data will first receive direct communication from Fannie Mae. The purpose of this contact is to offer education so that an appraiser has a chance to improve the quality of the data they are submitting. The future appraisals of those who receive these notifications will be monitored by Fannie to ensure improvement.

Appraisers with “egregious issues” will be contacted by Fannie, as well as the lenders that they have worked with in the last 12 months, and notified that either 100% of their appraisals will be reviewed post-purchase or that their appraisals will no longer be accepted by Fannie Mae at all. When a lender submits an appraisal made by an appraiser under 100% review, Fannie Mae will notify them of the reason for the review and provide examples of the questionable data. Lenders who haven’t submitted an appraisal from those appraisers will not have access to the reasons for review or any examples.

 

Reaction from Appraisers

This new website and review process are provoking many strong feelings from appraisers. Some think that these actions will push out appraisers who fail to produce quality appraisals, while others are afraid that nuances of their job will be missed and they may be unfairly targeted as providing sub par data. What are your thoughts on this hot topic? Let us know in the comments below.

Lenders, Sign Up to access the new AQM list here: Fannie Mae AQM Site

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