Story by Jeff Allen
The FHFA’s engagement of industry stakeholders signifies a critical inflection point for appraisal transformation. Modernization will either take root and flourish throughout every branch of the mortgage industry, or our industry could miss a critical window to introduce meaningful reforms.
While the fintech revolution has transformed the mortgage industry over the past 15 years — improving the borrower’s experience by reducing friction and increasing the speed of loan approvals — appraisal systems have remained largely unchanged.
A few years ago, cracks in the system finally started to show in the form of swelling turn times, delayed closings, and increasing borrower costs. For example, appraisal turn time has swelled 65% from 2018, according to Clear Capital data, and appraisal costs have also soared 24% since 2016.