Industry NewsMortgage

FHA delays new appraisal rules

RESPA rule changes still taking effect Jan. 1

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The Federal Housing Administration has pushed back to Feb. 15 implementation of new rules for appraisals that were originally scheduled to take effect on Jan. 1, in order to give FHA and lenders more time to adjust systems to accommodate the changes.The new rules are intended to bring FHA appraisal policies into "full alignment" with rules employed by Fannie Mae and Freddie Mac since May 1 to protect appraisers from coercion, the Department of Housing and Urban Development (HUD) said in announcing the changes in September.Real estate industry groups have complained that the new rules governing appraisals for Fannie and Freddie, the Home Valuation Code of Conduct, have derailed sales because they have shifted work to appraisal management companies, some of which have allegedly employed inexperienced appraisers.FHA's new appraisal guidelines may not have the same effect, because they include "geographic competency" requirements for appraisers, and allow lenders to pay...