By Meg Bennett, Vice President of Business Development, Computershare Loan Services
The coronavirus pandemic has substantially changed life as we know it. During the initial outbreak, the main priority was to slow the spread of the virus with ‘lockdown’ mandates and stay-at-home orders. Many companies adapted quickly, creating social distancing protocols or moving their teams, either wholly or partially, to a work-from-home model. Some businesses closed entirely. After five months, many of these changes remain in place, with some beginning to feel more permanent in nature. A ‘new normal’ has emerged for much of the world.
The mortgage sector is no exception, including appraisers, who have in many ways been operating on the ‘frontline’ during the pandemic. Our industry is dependent on appraisers being able to deliver property valuations to banks, mortgage lenders, and non-banking financial services companies. Nevertheless, the nature of their work creates some very specific health and safety concerns given the traditional dependence on physical visits to assess the value of a property. Appraisers really are essential workers in the mortgage industry.
Fortunately, federal government agencies, including Fannie Mae, Freddie Mac, the Federal Housing Administration (FHA), the Veteran Administration (VA), and the U.S. Department of Agriculture (USDA), issued new, temporary appraisal standards and procedures that allow for alternative inspections to minimize or eliminate physical contact. The new guidelines involve:
- Assessing risks by phone in advance of the appraisal by asking a number of set health and travel questions;
- Using alternative appraisal methods, such as drive-by inspections or desktop appraisals; and,
- Sourcing interior information using alternative sources, such as multiple listing service (MLS) or photos sent from the homeowner, rather than physical, in-home inspections.
In a few, short weeks, alternative inspection methods continued to multiply. As a result, the pandemic has helped to demonstrate the reliability of a bifurcated process, and we are now possibly witnessing the creation of a path for a more permanent use of new appraisal technology.
