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2015 HUD Appraisal Requirement Changes

Effective September 14, 2015, HUD Handbook 4000.1 (“HUD 4000.1”) contains numerous updates for appraisers to note on appraisals. There are hundreds of changes, and Maple Tree Funding has put together some of these changes to help our clients and realtor colleagues be ready for them.

This blog post is just a summary, and is in no way inclusive of all of the changes. This post includes changes to the 4000.1 which will have the greatest impact on the appraisal inspection, appraisal writing, and the use of the appraisal as a risk assessment tool for HUD/FHA.

The Full Handbook with the entire list of changes can be found here:  http://portal.hud.gov/hudportal/documents/huddoc?id=40001HSGH.pdf

(Please note, this is a very large file with over 850 pages and may take some time to open)

Key Changes Made to the HUD Appraisal Requirements

Some of the changes we have noticed are as follows:

  • The appraiser MUST state which of the subject’s utilities are on and operating.
  • The appraiser MUST operate and OBSERVE all built in cabinets and appliances to ensure they are in working order. This includes making sure all cabinets/ drawers operate effectively. This includes, but is not limited to, OBSERVING appliances such as dishwasher, stove, oven, disposal, refrigerator to ensure that they operate properly.
  • The appraiser MUST operate and OBSERVE the plumbing system to ensure no foul odors are emitted and the pressure is sufficient.
  • The appraiser MUST observe the roof. If an area of the roof is not observable, the appraiser MUST inspect the underside of the area from either the attic, or the floor below.
  • The appraiser MUST observe the attic in its entirety if access to the attic is available. If access to the attic is limited, or available only through a scuttle, then the “head and shoulders” inspection will be sufficient.

These are just a few of the changes that will be required during the appraisal process.

Help with Home Appraisal, Understanding Your Mortgage Options & More

If you are purchasing or refinancing a home and would like more information regarding the requirements of an appraisal, whether it be a Government Home Loan (FHA, USDA, VA) or a Conventional Loan, Maple Tree Funding can help! Our team of experienced mortgage loan originators are more than happy to answer your questions about the home appraisal process, and can provide you with the information you are looking for about your mortgage and home loan options.

Contact us today by calling (518) 782-1202 or filling out our online contact form to start the conversation with one of our licensed mortgage loan originators. We’d love to help you make your dream of homeownership a reality!

Posted in Home Buying Tips & Info on Friday, September 4, 2015 by Shane Latza