Appraisal reports communicate much more than just a value opinion. A well written appraisal report tells a story about a property, and that story has many components. One critical component is the market conditions as of the effective date of the appraisal. Lenders use appraisal reports to evaluate the relative risk associated with a loan. Accurate information about market conditions is an important part of that risk evaluation.
For lender-oriented appraisal work, the most common media used for appraisal reports are the Fannie Mae/Freddie Mac appraisal report forms, with form 1004 (the URAR) being the most common. Form 1004MC is used as an addendum to the 1004, providing support for the reported market conditions.
When completed properly, the 1004MC provides support for the “story” that is presented in other sections of the appraisal report. However, if the 1004MC is completely improperly, the result is often inconsistent and/or contradictory indications within a report.
Official instructions from Fannie Mae related to the 1004MC can be found in a variety of documents and other training media. The primary purpose of this publication is to present accurate instructions in a single source so that appraiser can have a clear understanding of what is expected in reports that are submitted to ServiceLink. The information herein is based on official publications and direct communications with Fannie Mae officials.
Several examples of correct and incorrect reporting are provided. The examples are all based on actual reports, but any data that could be used to identify the specific report has been redacted.
We sincerely hope that you find this publication useful, and we welcome any feedback that you wish to offer.
Danny Wiley, SRA
Chief Appraiser, ServiceLink
George Vann, SRA
Director of Education and Training, ServiceLink