As of February 15th, FHA’s latest guidelines (ML 09-28) require that appraisers must be paid “reasonable and customary” fees for the services provided, and that the fee to the appraiser must be independent of any markup for management services.

Consumers and other professionals must be careful to not allow “management” companies to make what some believe is already too expensive of a process, even more expensive.

Appraisers used to charge 400 to 450 for an FHA appraisal. In came the Housing Valuation Code of Conduct (HVCC), which, among other things, required that originators not be part of the ordering process of an appraisal. What occurred next was that the largest financial institutions opened up Appraisal Management Service companies, charged the buyer 450, but only paid the appraiser, on average, about 275 and put the rest in their pocket. In addition, FHA found that many of the appraisers being used and working for this lower fee, were unfamiliar with the local market and were turning in inferior work.

FHA’s Mortgagee letter 09-28 hopes to address this and other challenges brought about by the HVCC.
Here is the mortgagee letter:
http://search.yahoo.com/search?p=fha+mortgagee+letter+09-28&toggle=1&cop=mss&ei=UTF-8&fr=yfp-t-890

Chris Miscellaneous