Standardized Reconsideration of Value Process

Fannie Mae, in collaboration with Freddie Mac, has developed a framework for lenders to review and respond to a borrower-initiated reconsideration of value (ROV). This policy educates the borrower about their right to appeal an appraisal on their own behalf and how to do it. It also creates uniform industry-wide expectations for how to manage reconsiderations of value and maintains appraiser independence.

The lender’s policies and procedures must include steps for the borrower(s) to appeal an appraisal when they believe the opinion of value

• is unsupported,
• is deficient due to unacceptable appraisal practices, or
• reflects prohibited discriminatory practices.

Regardless of the outcome of the ROV, the lender is responsible for ensuring the appraisal report and opinion of value are reliable, adequately supported, and that the borrower’s concerns with the valuation are addressed in a timely manner.

Our updated policy includes specific instructions for the borrower disclosure that must be provided at the time of loan application and again upon delivery of the appraisal report as well as lender requirements for reviewing and responding to both the borrower(s) and appraiser.

Lenders are encouraged to implement these policies immediately but must do so for loans with applications dated on or after August 29, 2024. We’ll be providing more details about appraiser rights and responsibilities in our June Appraiser Update.