The Federal Housing Administration (FHA) has published new standards aimed at strengthening safeguards against unlawful discrimination in residential property appraisals.
The new standards, Mortgagee Letter 2024-07, enhance the FHA’s existing process for review and reconsideration of home valuations (ROV). The update requires lenders to establish minimum standards for borrower-initiated ROV requests, including providing disclosures and instructions at loan application and appraisal delivery.
“This update addresses key components of the Action Plan to Advance Property Appraisal and Valuation Equity,” the FHA said in a press release, citing inconsistent industry policies as an “obstacle” for some borrowers seeking legitimate revaluations.
