Reverse mortgage lenders will be required to use a web-based platform for mortgagee submissions of Federal Housing Administration (FHA) appraisal data and reports for case numbers assigned on and after June 27, 2016.
Through Mortgagee Letter 2015-08, The Department of Housing and Urban Development (HUD) announced the upcoming implementation of the FHA’s Electronic Appraisal Delivery (EAD) Portal for FHA-Insured Single Family Mortgages.
The guideline also applies to delivering forward origination appraisals.
The move mirrors what has already been done on the conventional lending side for Fannie Mae and Freddie Mac, noted Erik Richard, chairman and CEO of national valuation services company Landmark Network.
FHA is working with technology vendor Veros Real Estate Solutions (Veros) to build the system, which is the same technology provider for the Uniform Collateral Data PortalSM (UCDPSM), a joint effort between Fannie Mae and Freddie Mac.
The enterprise risk management, collateral valuation services and predictive analytics company has provided the portal service for Fannie and Freddie loans since 2011, according to the company’s website.
“I anticipate a relatively smooth transition for reverse lenders, considering a vast majority of FHA lenders and [Appraisal Management Companies] AMCs are using similar technology now and that most of us have already been through this,” Richard said.
The EAD portal will make it easier to do business with FHA by offering process and technology efficiencies that “streamline appraisal data transmission, promote quality up-front appraisal data, and reduce post-endorsement appraisal data corrections,” HUD said in a statement.
The EAD portal will allow transmissions to FHA of only those appraisals that comply with FHA’s Single Family Housing Appraisal Report and Data Delivery Guide.
“When submitting an appraisal, the portal provides a confirmation of a successful submission, or information regarding required corrections that may need to be made before resubmitting and transmitting to FHA,” HUD said.
Mortgagees should note that appraisals submitted through the EAD portal remain subject to a review for compliance with FHA appraisal requirements and mortgagees remain responsible for proper underwriting of the appraisal and for ensuring the property meets FHA’s minimum property requirements and standards for serving as security for the FHA-insured mortgage, HUD noted.
In addition, the appraiser remains accountable for appraisal quality, credibility, and compliance with FHA appraisal requirements, HUD said.
FHA will incorporate the EAD portal into the Single Family Housing Policy Handbook.
“Web-based, on-demand training will be available,” HUD said, adding that mortgagees are “strongly encouraged to ensure their authorized users and/or designated third-party service providers complete the training before accessing the EAD portal.”
Read Mortgagee Letter 2015-08 here.
Written by Cassandra Dowell