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HUD Handbook 4000 1 Requirements and Webinar

 On March 18th, FHA published an update to its appraisal and property requirements in HUD Handbook 4000.1.  The changes detailed in the document become effective on all mortgages with FHA Case Numbers assigned on or after June 15, 2015. The points below detail the most notable changes from previous requirements:
  • Properties with a Legal Non-Conforming Use:  requiring the appraiser to comment if improvements can be rebuilt by right.
  • Accessory Dwelling Units: emphasizing Highest and Best Use to determine property type of classification. 
  • Attic and Crawl Space Inspection Requirements: clarifying that FHA requires an inspection.
  • General Acceptance Criteria, Property Eligibility, and Non-Residential Use of Property: ensuring that mixed-use properties comply with zoning.
  • Cost and Income Approach for Value: all appropriate approaches must be utilized when applicable.
  • Sales History of Comps: Requiring three years or more, instead of one year, and requiring due diligence by the appraiser for analyzing prior sales of comparable properties.
  • Energy Efficient Building Components, Solar Systems, etc.: requiring that contributory value of building components that enhance efficiency or energy savings must be analyzed and reported. FHA requires that the appraiser utilize all appropriate methods of valuation and does not restrict this to only a matched pairs analysis
As a member of the CoesterVMS Appraiser Network, we highly encourage participation in the overview call hosted by FHA on this topic.  See below for the details of this event:
  • Date: April 16, 2015 
  • Time: 2:00 PM - 3:00 PM (Eastern)
  • Title: SF Handbook Appraiser & Property Requirements
  • Dial-in Number: (866) 254-5938
  • Participant Access Code: 355444 (Please note that this access code has changed from the code published in FHA’s online article on March 18, 2015.)
As engagement verbiage on CoesterVMS order will change with this update, we will also host a webinar on HUD Handbook 4000.1 closer to the June 15, 2015.  Further announcements will provide updates on this event. We appreciate your patience and involvement in this transition.