Appraisers……..This will seem a bit ‘dry’but it’s something you need to know.
The UAD form reporting process we all are thrilled with has other components. Part of this initiative mandated by the conservator to the GSE’s is an electronic review portal called the Uniform Collateral Data Portal (UCDP). The UCDP will become more stringent and restrictive as of Jan. 23, 2013.
The UCDP is designed as a second-level defense to be sure appraisal reports have proper and mathematically acceptable info. This info is apparently based on certain GSE reporting requirements in their Seller Guides, and also per info in the UAD Appendix D we need to comply with. Each report will be run through the UCDP electronic review process at the GSE level, and to some degree will
probably be implemented by AMC’s and Lenders.
You can read more about this process in the attached PDF Download UCDP - User-Guide-Fannie-Mae-messaging
The Appendix pages, starting on page 21, show what will cause your report to be ‘hard stopped’ or to have a ‘warning’ issued. Once a ‘warning’ is generated, the report will be automatically ‘hard stopped.’ Meaning: lending process will halt until corrected. If the appraiser has not described within the report information that will allow a convincible override by the Lender, it will probably result in a QA notice back to the appraiser for additional info or correction.
What is interesting and unclear to me is wording used to flag the ‘warning’ messages, such as:
“HOA fee relative to appraised value appears excessive.”
“Subject property’s year built is outside the expected range.”
“Subject property’s prior sale amount is not in the expected range relative to appraised
“Finished basement area for comparable property #<comparable number> is significantly
different from the subject property.”
But what this really means is ‘math’ will be used to evaluate differences between subject and all comps. Your report will be computer read, with a generated report before an actual human reviewer sees it. This is all made possible by MISMO XML! But how the ‘excessive,’ ‘expected’ and ‘significant’
differences will be determined is not defined – at least in this document.
The first level defense to properly documented reports is your report software on-board UAD reviewer which should be run prior to report delivery to the client. Another suggestion: review (and perhaps print to keep) pages 21 through 30 of the PDF. Get familiar with how the UCDP electronic review will be conducted, and then structure your reports accordingly.
The take-away: be sure all your comps are 100% matches to the subject! Your reports
will then zoom through the system, never to be ‘hard stopped.’