NAHB: Appraisal Process Inadequately Monitored, GAO Study Finds
The NAHB has responded to a study that finds the home appraisal process to be inadequately monitored.
The National Association of Home Builders released this week an official response to a study that finds the home appraisal process to be inadequately monitored.
"With one out of every three home builders reporting that they have lost signed sales contracts because of flawed appraisals, a new report from the Government Accountability Office (GAO) ramps up the pressure for a solution to this critical problem," says the Association on its website, NAHB.org.
The newly published report from the Government Accountability Office (GAO) this month cites multiple inadequacies in the regulation and enforcement of standard appraisal practices, and clearly states that the authority that oversees appraiser regulatory programs established by the states needs to improve its monitoring procedures. Specifically, the GAO report finds that the Appraisal Subcommittee that oversees appraiser regulatory programs has "limited" enforcement tools and procedures for reporting compliance levels.
The report also cites "several weaknesses" that have potentially limited that body's ability to monitor state appraiser regulatory agencies, federal financial institution regulators and the Appraisal Foundation (a private, nonprofit corporation that sets criteria for appraisals and appraisers). Observing that "the critical role of real estate appraisers in mortgage underwriting underscores the importance of effective regulation of the appraisal industry," the GAO study calls on the Appraisal Subcommittee to strengthen its oversight by developing specific policies and procedures for monitoring the appraisal requirements of the federal financial institutions regulators.
The NAHB's full response is available here.
The text of the GAO report can be found here. (PDF)
