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Amended Test Forms Are Released for Comment
In June 2004, Fannie Mae released "test" versions of three appraisal reports:
1. Test Form 1004, Uniform Residential Appraisal Report (URA R),
2. Test Form 1004B, Definitions, Statement of Limiting Conditions, and Appraiser's Certification, and
3. Test Form 1004D, Appraisal Update and/or Completion Report.1
These test forms were the result of comments Fannie Mae had received regarding the need for it to revise and improve its appraisal report forms. The most significant of these forms was the revised URAR (Test Form 1004). The revised URAR was meant to be used with the Definitions, Statement of Limiting Conditions, and Appraiser's Certification Form (Test Form 1004B) and to facilitate a summary appraisal report for single-unit residential properties. The new forms were designed to bring Fannie Mae's forms into compliance with the Uniform Standards of Professional Appraisal Practice (USPAP) and to address some current real estate lending problems. The new test forms incorporated several innovative and quite controversial ideas. Many appraisers were concerned about the extra work that would be required to complete these new forms, and some were quite vocal in conveying their concerns with the test forms.
In July 2004, Fannie Mae released four additional test forms.2 These test forms were:
1. Test Form 1004C, Manufactured Home Appraisal Report,
2. Test Form 1025, Small Residential Income Property Appraisal Report (SRIP),
3. Test Form 2000, One-Unit Residential Appraisal Field Review Report, and
4. Test Form 2000A, Two- to Four-Unit Residential Appraisal Field Review Report.
The Manufactured Home Appraisal Report (Test Form 1004C) was a new form; it was designed to replace the addendum that had been required when manufactured home appraisals were reported on the URAR. Test Forms 1025 and 2000 were proposed updates of existing forms. Test Form 2000A was a new form to be used to do field reviews of two- to four-family appraisal reports. Again, compliance with USPAP was clearly a goal of these new forms along with updating reporting procedures to accommodate current lending practices.
In November 2004, Fannie Mae announced modifications to test forms that had been released earlier in the year.3 The revised test forms are described in Table 1.4
Property Flipping Concerns
A number of test form changes are directed at fraudulent real...