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On March 23, 2020, the Federal Housing Finance Agency directed Fannie Mae and Freddie Mac to allow the use of appraisal alternatives to reduce the need for appraisers to conduct interior property inspections for eligible mortgages through May 17, 2020.
This move is intended to reduce transaction delays due to appraisers unable or unwilling to enter properties to conduct interior inspections.
Fannie Mae
On March 23, 2020, Fannie Mae issued Lender Letter LL-2020-04, Impact of COVID-19 on Appraisals, which contains temporary guidance on appraisal requirements. Under the guidance, lenders will be allowed to use desktop appraisal and exterior only appraisals for purchase transactions through May 17, 2020. Fannie May has also provided language that the appraiser must copy and paste into their report in order to accommodate the revised scope of work, statement of assumptions and limiting conditions, and certifications for some of the scenarios presented.
Fannie Mae Appraisal Alternatives
Freddie Mac
On March 23, 2020, Freddie Mac issued Bulletin 2020-5, Selling Guidance Related to COVID-19, which contains temporary guidance on appraisal requirements. Under the guidance, lenders will be allowed to use desktop appraisal and exterior only appraisals for purchase transactions through May 17, 2020. Freddie Mac has also provided language that the appraiser must copy and paste into their report in order to accommodate the revised scope of work, statement of assumptions and limiting conditions, and certifications for some of the scenarios presented.