Starting today, your appraisals are going to look a bit different. Basically, the agencies have been warning us for the last year or so that they were creating a uniform set of “codes” that will be used by all appraisers nationwide.
Fannie and Freddie have implemented the new codes as of Sept. 1, but FHA just announced that they are delaying implementation until Jan. 1, 2012. While most of the changes involve changing the written explanations to codes, here are six of them that you and your clients will definitely want to know about.
1. Bathroom Code: Instead of saying 2.5 bathrooms, the appraiser will now say 2.1 bathrooms. The figure to the left of the decimal means full bathrooms and the number to the right of the decimal point is the amount of half-baths. So the number 3.4 means there are three full and four half-baths.
2. Condition Rating Code: You'll no long see “good, average or poor” ratings. There will now be codes from C-1 to C-6, with C-6 being the worst and will probably not be able to finance this property.
3. Qualify Rating Code: This basically applies to new construction, either a new home or an addition to an existing home. The codes will be Q-1 to Q-6.
4. Type of Home Code: Appraisers can no long just say that the home is “single story or 2-story." They must be specific of the type of design like, colonial, contemporary, Victorian, farmhouse, ranch, cottage, etc.
5. Other codes: There are 60 “fields” that have changed that have initials instead of descriptions, which are included in the Charts/Checklist section available to subscribers of MortgageCurrentcy.com
6. Basement Information: Appraisers will also be required to report the square footage of basements, regardless if it is finished or not.
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Karen Deis is the publisher of
