The US Department of Housing and Urban Development (HUD) unveiled a proposed rule in the Federal Register to ensure the agency’s rules conform with the Housing and Economic Recovery Act (HERA) of 2008. The proposed rule requires that appraisers approved by the Federal Housing Administration (FHA) be certified, rather than licensed, by a state appraisal licensing board in order to provide appraisals for mortgages insured by FHA. Comments are due September 12, 2011.
While this proposed rule will officially make HUD in compliance with HERA, the agency has been using only state-certified appraisers for some time. Mortgagee Letter 2008-39: Revised Eligibility Requirements for FHA Roster Appraisers was released on December 17, 2008. The ML stated that all appraisers performing FHA appraisals must be state certified by October 1, 2009.
FHA will not, however, recognize appraisers certified by a “nationally recognized professional appraisal organization” in lieu of certification by a state appraisal licensing board. While HERA provides this flexibility, the proposed rule states that FHA will accept only appraisers certified by the state to “prevent disruption and to ensure efficient processing of mortgage insurance.”
Effective October 1, 2008, FHA stopped accepting applications to the FHA
Appraiser Roster from licensed but uncertified appraisers. All applicants for the
FHA Appraiser Roster must be state certified (certified residential or certified
general) appraisers who meet the minimum certification criteria issued by the
Appraiser Qualifications Board (AQB) of the Appraisal Founda