Appraisal Organizations Commend Cuomo for Affirming Importance of Independent Appraisals

WASHINGTON (Map) - WASHINGTON, March 3 /PRNewswire/ -- The nation's four leading professional appraisal organizations -- the Appraisal Institute, American Society of Appraisers, American Society of Farm Managers and Rural Appraisers, and National Association of Independent Fee Appraisers -- today commended New York State Attorney General Andrew Cuomo for his continuing efforts to reinforce the independence of real estate appraisers, which today resulted in an agreement signed between his office and Fannie Mae, Freddie Mac and the Office of Federal Housing Enterprise Oversight.

Representing 30,000 real estate appraisers, the four organizations said in their letter that they "strongly support [Cuomo's] efforts to work with Fannie Mae and Freddie Mac to reinforce the independence of real estate appraisers and the integrity of appraisals in connection with mortgage loans sold to the government-sponsored enterprises."

Cuomo has been investigating the causes behind mortgage fraud for nearly a year and issued subpoenas to Fannie Mae and Freddie Mac in an effort to discern how widespread the problem had become. The March 3 agreement with the two secondary mortgage market giants seeks to prohibit appraiser coercion by lenders and to enhance quality control in the appraisal process. The agreement includes a Home Valuation Code of Conduct that Fannie Mae and Freddie Mac will apply to lenders selling mortgages to the two entities. The Code also requires the GSEs to set up a complaint hotline.

In their letter to Cuomo, the appraisal organizations pointed out that "For more than 75 years, our organizations have developed and promoted standards of practice and codes of conduct for real estate appraisers; protecting the independence of appraisers and the appraisal process is our highest mission. We are pleased to see that today's agreement attempts to address weaknesses in appraisal independence, and we look forward to working with you during the comment period to resolve any concerns."

The agreement seeks comments from the federal banking agencies and market participants that will be considered in making amendments to the Code during the implementation process. The Code becomes effective on January 1, 2009.

The Appraisal Institute is a global membership association of professional real estate appraisers, with nearly 23,000 members and 92 chapters throughout the world. Organized in 1932, its mission is to support and advance its members as the choice for real estate solutions and uphold professional credentials, standards of professional practice and ethics consistent with the public good. The Appraisal Institute advocates equal opportunity and nondiscrimination in the appraisal profession and conducts its activities in accordance with applicable federal, state and local laws. Members of the Appraisal Institute benefit from an array of professional education and advocacy programs, and may hold the prestigious MAI, SRPA and SRA designations.