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Increase Your Business by Doing Appraisals for FHA

The credit crisis is hurting all aspects of the real estate industry – including appraisers. Conventional mortgages are requiring bigger down payments again and subprime mortgage products are nearly impossible to find. One way for appraisers to expand their business is to become FHA certified. In 2006, FHA had less than 2 percent of the mortgage market, according to a speech by FHA Commissioner Brian Montgomery. By July 2008, the number was up to 10 percent. On August 18, MBA released a report that FHA business as tripled since this time last year!

If you are not on the FHA roster of approved appraisers you need to be as this business is not going down anytime soon. To become FHA approved you must be state-licensed or state-certified with credentials based on criteria issued by the AQB and you cannot be listed on the General Services Administration’s (GSA) Suspension and Debarment List, HUD’s Limited Denial of Participation List, or HUD’s Credit Alert Interactive Voice Response System (CAIVRS). As of May 5, 2008, all applications must be submitted online at www.fha.gov.

Of course, there is always a great unknown and this is no different. In the recently passed Housing and Economic Recovery Act (HERA) of 2008 there is a provision that will impact appraisers interested in on the FHA roster. Section 1404 of the legislation states that any approved appraiser must be state certified or certified by a nationally recognized appraisal organization. The appraiser must also demonstrate verifiable education in appraisal requirements established by FHA. It’s not yet clear if current FHA appraisers will be grandfathered in, how much time appraisers will have to get state certified, or what is meant by a “nationally recognized appraisal organization.” As information becomes available we will be sure to post it. Stay tuned…

Comments
  1. Joe Wilcox

    The questions are asked from a consumer point of view.
    1. How can I be certain that I have an “educated” appraiser who knows what he/she is doing?
    2. How do I verify certified credentials based on criteria issued by the AQB?
    It would be very helpful to have a consumers guideline on how to check on appraisers and FHA certified appraisers.

  2. Jerry Nagy

    I think the idea of a consumer guideline is a great idea. I know the Michigan Association of Realtors has a brochure on the appraisal process.
    It would probably be good to have a more detailed publication for consumers.

  3. I have been an FHA approved appraiser for many years but have only had the opportunity to do a few appraisals. I hear and read about there being so many FHA loans being made now, how do I get more appraisal request? I am certainly qualified and experienced (have been in the appraisal feild for 30+ years – Certified Residential). I spoke to an appraiser, while attending a recent seminar, who says that he gets five or more appraisals weekly. I need and want the work, what must I do? I am located in Antioch, CA (Contra Costa County) and also cover Alameda Co., Sonoma Co. and San Mateo County.

  4. Les Strange

    Any appraisal who is going be doing FHA appraisals should be well advised to obtain a copy of the HUD Handbook 4150.2.
    There is a wealth of information in that handbook that explains very clearly what HUD expects to see on the 1004, 1004C, 1073, and the 1025 Forms.
    This manual is a MUST for those who are now or will be doing FHA appraisals.

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