Selection of the Appraiser
The lender
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is responsible for the selection of appraisers and for the qualifications and quality of work provided by the appraisers that are selected;
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may not use appraisals ordered or received by borrowers or other parties with an interest in the transaction, such as the property seller or real estate broker. Fannie Mae does allow lenders to use third-party vendors (for example, appraisal management companies) to manage the appraiser selection process. However, it should be noted that if a lender enters into a contract with any vendor, contractor, or third-party service provider, the lender is accountable for the quality of the work performed as if it was performed by an employee of the lender.
The lender (or its authorized agent)
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must establish policies and procedures to ensure that qualified individuals are being selected in accordance with Fannie Mae requirements, including the Appraiser Independence Requirements .
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must ensure that an appraiser has demonstrated the ability to perform high quality appraisals before using an appraiser’s services. The quality of an appraiser’s work is a key criterion that must be used in determining which appraiser the lender (or its authorized agent) uses for its assignments. The requirement for an appraiser to produce a high quality work product must always outweigh fee or turnaround time considerations.
Delegating these responsibilities to a third party does not relieve the lender of its responsibilities related to the appraisal or the value, condition, and marketability of the property. See B4-1.3-12, Quality Assurance, for information related to ongoing review of appraisals.
For more information, see B4-1.1-03, Appraiser Selection Criteria.