As previously reported, this summer the U.S. Department of Housing and Urban Development (HUD) filed a housing discrimination charge under the Fair Housing Act against an appraisal company, individual appraiser, appraisal management company and lender based on an asserted biased appraisal and denial of a mortgage refinance loan application based on the appraisal.… Continue Reading
Appraisals
CFPB/Fed/OCC increase exemption thresholds for appraisal requirement, Regs Z and M
The CFPB, Fed, and OCC have announced that they are increasing exemption thresholds that are subject to annual inflation adjustments. Effective January 1, 2025 through December 31, 2025, these exemption thresholds are increased as follows:
- The 2025 threshold for higher-priced mortgage loans that are subject to special appraisal requirements will increase from $32,400 to $33,500.
HUD, Fannie Mae and Freddie Mac Delay Implementation of Reconsideration of Value Guidance
By Richard J. Andreano, Jr. on
As previously reported, the U.S. Department of Housing and Urban Development (HUD) in connection with single-family residential mortgage loans insured by the Federal Housing Administration (FHA), and Fannie Mae and Freddie Mac in connection with single-family residential mortgage loans, announced Reconsideration of Value (ROV) guidance for appraisals to help address appraisal bias.… Continue Reading
HUD Charges Appraiser, Appraisal Management Company, and Lender with Race Discrimination
By Loran Kilson & Richard J. Andreano, Jr. on
The Department of Housing and Urban Development (HUD) recently charged multiple entities with housing discrimination based on an asserted biased appraisal and denial of a mortgage refinance loan application based on the appraisal. Charges were brought against the appraisal company, Maverick Appraisal Group; the appraisal management company, Solidifi U.S. Inc.; the lender, Rocket Mortgage, LLC; and the individual appraiser.… Continue Reading
Federal Agencies Finalize Reconsideration of Value Guidance
By Richard J. Andreano, Jr. on
A group of federal agencies have finalized reconsideration of value (ROV) guidance for residential real estate valuations. The agencies are the Comptroller of the Currency (OCC), Consumer Financial Protection Bureau (CFPB), Federal Deposit Insurance Corporation (FDIC), Federal Reserve Board (Board) and National Credit Union Administration (NCUA). The guidance will be effective upon publication in the Federal Register.… Continue Reading
HUD Enters Conciliation Agreement with the Appraisal Foundation to Curb Discrimination in the Industry
By Loran Kilson on
The U.S. Department of Housing and Urban Development (HUD) announced that it has entered into an historic Conciliation Agreement (Agreement) with The Appraisal Foundation (TAF), an organization responsible for setting standards and qualifications for real estate appraisers and providing voluntary guidance for appraisers. This Agreement resolves a Secretary-initiated complaint against TAF alleging discriminatory barriers preventing qualified Black people and other persons of color from entering the appraisal profession on the basis of race in violation of the Fair Housing Act.… Continue Reading
Federal Agencies Issue Final Automated Valuation Model Quality Control Rule
By Richard J. Andreano, Jr. on
Federal banking regulators recently began adopting a final rule that requires, among other things, supervised mortgage originators and secondary market issuers to ensure that automated valuation models they use follow quality control standards, including a requirement that they comply with nondiscrimination laws. The final rule will be effective on the first day of the calendar quarter following the 12 months after publication in the Federal Register.… Continue Reading
HUD, Fannie Mae and Freddie Mac Issue Reconsideration of Value Guidance to Combat Appraisal Bias
By Richard J. Andreano, Jr. & Loran Kilson on
The U.S. Department of Housing and Urban Development (HUD), through the Federal Housing Administration (FHA), recently issued Mortgagee Letter 2024-07 addressing reconsideration of value (ROV) policies in connection with appraisals for FHA insured mortgage loans under the Title II forward mortgage loan and reverse mortgage loan programs. The amended Mortgagee Letter may be implemented immediately but must be implemented for FHA case numbers assigned on or after September 2, 2024.… Continue Reading
CFPB Addresses ASC Appraisal Bias Hearings and Structure of The Appraisal Foundation
By Loran Kilson & Richard J. Andreano, Jr. on
The CFPB published a blog discussing a few key takeaways from a series of public hearings addressing appraisal bias.
For background, the Federal Financial Institution Examination Council’s (FFIEC’s) Appraisal Subcommittee (ASC) has held four public hearings throughout 2023-2024 to facilitate discussions regarding bias and lack of diversity within the appraisal business.… Continue Reading
HUD Issues 2023 Update to Housing Equity Action Plan
By Richard J. Andreano, Jr. on
The U.S. Department of Housing and Urban Development (HUD) recently issued a press release announcing a 2023 update to its Equity Action Plan. The Equity Action Plan is part of HUD’s efforts to implement President Biden’s Executive Order on “Advancing Racial Equity and Support for Underserved Communities Through the Federal Government.”… Continue Reading