APPENDIXDVALUATIONPROTOCOL-HUDU.S.doc

APPENDIX D: VALUATION PROTOCOL The appraisal process is the lender’s tool for determining if a property meets the minimum requirements and eligibility standards for a FHA-insured mortgage. Underwriters bear primary responsibility for determining eligibility; however, the appraiser is the on-site representative for the lender and provides preliminary verification that the General Acceptability Criteria standards have been met. FHA RESIDENTIAL APPRAISAL REQUIREMENTS This section provides specific instructions for completing appraisal report forms. The appraisal reporting form to be used will depend on the property type that is being appraised. The appraiser must select the appropriate appraisal form for reporting an FHA appraisal from the following: Uniform Residential Appraisal Report (Fannie Mae Form 1004 March 2005) – Required to report an appraisal of a one-unit property or a one-unit property with an accessory unit. Manufactured Home Appraisal Report (Fannie Mae Form 1004C March 2005) – Required to report an appraisal of a one-unit manufactured home. Individual Condominium Unit Appraisal Report (Fannie Mae Form 1073 March 2005) – Required to report an appraisal of a unit in a condominium project or a condominium unit in a planned unit development (PUD). Small Residential Income Property Appraisal Report (Fannie Mae Form 1025) – Required to report an appraisal of a two- to four-unit property. An appraisal performed for HUD/FHA purposes requires that all sections of the appraisal form be addressed. The appraiser must complete the form in a manner that clearly reflects the thoroughness of the investigation and analysis of the appraisal findings. The conclusions about the observed conditions of the property provide the rationale for the opinion of market value. The completed appraisal form utilized, together with the required exhibits, constitutes the reporting instrument to HUD for FHA-insured mortgages. The FHA Appraisal is made Under t