Interesting Announcement From FNMA Today
FNMA has updated their Selling Guide.
You can view the announcement here:
Of particular interest to Appraisers are updates to:
(Excerpts from the Selling Guide below are in Italics.)
Fannie Mae has clarified its current policy and implemented a new policy with respect to homes with solar panels. While not explicitly stated, Fannie Mae currently purchases loans on properties with solar panels when the borrower owns the equipment under standard Selling Guide requirements. With these revisions, the Selling Guide has been updated and this policy has been expressly stated. Additionally, in recognition of more prevalent financing options and financial agreements available in the marketplace, such as solar leases and power purchase agreements, Fannie Mae has developed a new policy.
Solar panels that are least from or owned by a third-party under a power purchase agreement or other similar arrangement are to be considered personal property items and are not included in the appraised value of the property. See B2-3-04, Special Property Eligibility Considerations for additional eligibility requirements for properties with solar panels.
Adjustments to Comparable Sales
As a result of an analysis of Uniform Appraisal Dataset data specific to comparable adjustments, Fannie Mae has eliminated the 15% net and 25% gross adjustment guidelines and has provided clarification with respect to Fannie Mae’s expectations for the appraiser to analyze the market for competitive properties.
Fannie Mae does not have specific limitations or guidelines associated with net for gross adjustments. The number and/or amount of the dollar adjustments must not be the sole determinate in the acceptability of a comparable. Ideally, the best and most appropriate comparable would require no adjustment; however this is rarely the case as typically no two properties or transaction details are identical. The appraiser’s adjustments must reflect the market’s reaction (that is, market-based adjustments) to the difference in the properties. For example, it would be inappropriate for an appraiser to provide a $20 per square foot adjustment for the difference in the gross living area based on a rule of thumb when market analysis indicates the adjustment should be $100 per square foot. The expectation is for the appraiser to analyze the market for competitive properties and provide appropriate market-based adjustments without regard to arbitrary limits on the size of the adjustment.
You can read all of Fannie Mae’s general appraisal requirements from the selling guide starting on page 558 at the following link: