HUD Issues New Guidance To Protect Home Mortgage Borrowers From Appraisal Bias

By HUD Photos: HUD\Facebook WASHINGTON – Today, the U.S. Department of Housing and Urban Development (HUD), through the Federal Housing Administration (FHA), announced a major new step in the Department’s work to protect borrowers from racial or ethnic bias in home appraisals. FHA’s new requirement for lenders participating in its Single Family program will enable borrowers to request a re-assessment of the appraised value of their property if they believe that the appraisal was inaccurate or biased. The Reconsideration of Value policy represents months of collaboration with the Federal Housing Finance Agency to develop an aligned approach for both FHA-insured mortgages and those purchased or guaranteed by Fannie Mae and Freddie Mac. “We know that biased home appraisals not only disproportionately harm homeowners of color, but stunt economic opportunity for the communities we serve,” said HUD Acting Secretary Adrianne Todman. “Today, we are announcing a new step in our work to root out racial and ethnic bias in home valuations, which will give borrowers greater ability to have their home valuation reconsidered.” Today’s announcement fulfills a commitment of the Interagency Task Force on Property Appraisal and Valuation Equity (PAVE), made up of leaders from 13 federal agencies, to establish a...