Recently NAR President Charles McMillan wrote to FHA Commissioner Dave Stevens to request the Federal Housing Administration's (FHA) requirement of two appraisals in certain circumstances be rescinded. Mortgagee Letter 2008-09, released on April 1, 2008, states that a second appraisal is required for properties that exceed $417,000. The property must also be in a declining area where the loan-to-value (LTV) ratio, including upfront mortgage insurance premium, exceeds 95 percent.
NAR believes this requirement imposes an undue burden on properties in the hardest hit markets, is redundant and increases the cost of the real estate transaction for the consumer. One appraisal, completed in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP), should be sufficient to reflect the true value of a home.