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Innovative Standardization: The Next Gen of Standard Appraisal Forms
Fannie Mae and Freddie Mac are currently collaborating on a game-changing initiative to redesign the uniform appraisal dataset (UAD) for their standard appraisal forms. This project has been in the works since 2019, and we will likely see it come to fruition by the end of 2023. This is a huge undertaking that involves subject matter experts across the country, including appraisers, lenders, appraisal management companies, government agencies, and other trade organizations.
Standardizing appraisal forms to maximize efficiency has been a major pain point for the industry, so Fannie and Freddie are heavily invested in getting this right. With this initiative, they are taking a very different approach to anything that we've seen in the past. This will really be a complete makeover of the system that governs how appraisers report their value opinions.
The upcoming changes represent a move from a static standardized form to a form with dynamic formatting capabilities that will adjust to the properties and characteristics being appraised. Appraisal forms as we know them will eventually be phased out as the new standardized forms go into use. In this post, we’ll discuss some of the upcoming changes to standard appraisal forms.
What changes are coming?
The new reporting system is designed to force appraisers to enter required data elements depending on various dynamic factors, including the type and characteristics of the property, market trends, public data, and other relevant information that might impact value.
Those elements would then trigger other dependencies to determine what information should be included in the report. This helps ensure that, when the process is complete, the analysis is well-documented, fully supported, and the important details are represented in the report.
These changes are meant to eliminate extraneous data elements that really have nothing to do with a property’s value, and will make for much cleaner reports. Under this new system, all property reports will be UAD compliant.
Key Highlights of the New UAD
The goal of the new UAD is to introduce a single standardized report for any residential property type. It will create greater efficiency in the appraising process by modernizing the way the appraisers fill these forms out—it will be much more like a TurboTax user experience.
Here are some key highlights of the new UAD:
- Reports only relevant data
- Dynamic based on input
- Easy-to-read appraisal analysis and conclusion
- Standardized, well-structured, readable forms
- Discrete data, pertinent commentary, and photos contained in the relevant sections designed to reduce reliance on addenda
Which forms will be impacted by the new UAD?
The next generation of standard appraisals is coming soon. When the UAD is updated, some common forms will change, including:
Single Family and Condo Appraisal Reports
- 1004/70
- 1073/465
- 1075/466
- 2055/2055
Cooperative, Manufactured Home, 2-4 Unit, Rent Schedule, and Update Completion Appraisal Reports
- 1004C/70B
- 2090
- 2095
- 1025/72
- 1004D/442
- 1007/1000
Accurate property value information is key to minimizing lending risk, and keeping up with changes in the industry is vital for lenders. For efficient, accurate valuation options that keep your financial institution fully compliant, rely on SWBC’s suite of valuation services.
Learn about SWBC Lending Solutions' Valuation options.
Chuck Mureddu
Chuck Mureddu has more than 30 years of combined mortgage lending experience, including appraisal management, institutional risk, loss mitigation, and whole loan exit and securitization strategies. As the Chief Valuation Officer for SWBC Lending Solutions, Chuck is responsible for all valuation policy and process, quality assurance, and regulatory compliance.
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