The Interagency Task Force on Property Appraisal and Appraisal Equity (PAVE) celebrated its one-year anniversary on Thursday, March 23, after releasing its action plan to prevent instances of bias in the housing appraisal process.
Thank you for reading this post, don't forget to subscribe!led by U.S. Department of Housing and Urban Development (HUD) Secretary Marcia Fudge and white House Domestic Policy Adviser Ambassador Susan Rice .
“In just 12 months, the PAVE Task Force has made significant progress toward fully implementing the action plan, which includes empowering consumers with new tools and greater awareness of valuation bias; leveraging data to identify trends and crack down on perpetrators of valuation bias; and supporting a well-trained and dynamic appraiser profession,” the White House said in a statement shared with HousingWire.
Over the past 12 months, the White House says it has helped “empower consumers” to take action against instances of appraisal bias, including by drafting a process for borrowers. federal housing administration (FHA) financing to request a reconsideration of value (ROV) if they suspect that a lower than expected appraisal may be due to bias. HUD also announced this week that it has awarded $54 million in grants to 42 states designed to prevent assessment bias.
The White House said the Evaluation Subcommittee (ASC) of the Federal Financial Institutions Testing Council held a hearing in January regarding rating bias, bringing together members from the public and private sectors to “define the problem and discuss possible solutions.” brought.
In October, the federal housing finance agency (FHFA) published the first publicly available dataset of aggregated statistics on assessment records, giving the public access to the data and trends found in assessment reports.
“Using these new data, academic researchers have already published new analyzes showing differences in household evaluations across racial and ethnic groups,” the White House said. “FHFA, with HUD, [the U.S. Department of Agriculture (USDA) and the U.S. Department of Veterans Affairs (VA)]Working to create a federal database to share assessment data across the federal government [which] could allow agencies to better share oversight and enforcement actions, and facilitate new research related to property valuations.”
The White House also says it aims to change the nature of the appraisal profession, “taking steps to remove unnecessary educational and experience requirements that limit access to the profession and for underrepresented groups to strengthen anti-bias, fair accommodations.” make it difficult for them.” and proper on-the-job training of existing appraisers.
In January, the VA issued new guidance for its own appraiser workforce, which “enhances inspection procedures to detect potentially discriminatory bias in appraisal reports filed by VA fee panel appraisers, and all VA fee panel appraisers and lenders.” -Allows approved employees to participate in an evaluation of bias, reasonable accommodations and fair lending training, the White House said.
In 2022, the Federal Appraisal Subcommittee awarded a grant to the state of Mississippi to facilitate a pathway toward obtaining appraiser licenses from underrepresented groups, as some under-served communities in the state face a shortage of appraisers.
The White House said, “Mississippi’s success has prompted several other states to express interest in replicating the program.”
HUD publicized the one-year anniversary of its PAVE initiative following several major federal actions on appraisal bias in the month of March.
Earlier this month, the Department of Justice And this consumer financial protection bureau filed a statement of interest in a lawsuit against LoanDepot and 20/20 Appraisal alleging racial bias that resulted in low appraisals for a Maryland couple. In filing a statement of interest, the agencies are effectively saying that lenders will be held liable if there is appraisal discrimination.
and perhaps the biggest blow to valuation and evaluation in decades, fannie mae Recently announced that traditional assessments will no longer be the default standard. The GSE updated its sales guide to include more options for property valuation, including value acceptance – previously known as appraisal discount – as well as “value acceptance plus property data and hybrid valuation”. “
