WASHINGTON—The Federal Housing Administration has released a mortgagee letter, revoking three appraisal policies related to fair housing considerations. The agency stated that these policies were part of a Trump administration initiative to ease regulations, the ABA Banking Journal reported.
The letter rescinds a 2021 mortgagee letter clarifying the requirements for appraisers and mortgagees with fair housing laws in the appraisal process. It also rescinds two 2024 letters on the use of reconsiderations of value in appraisals. An ROV is a request that a financial institution may make to the appraiser or other entity that developed a valuation report for a property being used as collateral for a loan to re-assess the report based on potential deficiencies or information that may affect the value, ABA Banking Journal explained.
The Biden Administration rescinded these policies as part of a broader effort to address what officials described as bias in the appraisal process. In its letter revoking the policies, the FHA referenced a Trump-era executive order that reversed regulations impacting key sectors, including the housing market, ABA Banking Journal said.
“Rescinding the policy announced in these [mortgagee letters] is a step in aligning with the administration’s broader goal to reduce unnecessary regulatory burden and foster long-term economic stability for all Americans,” FHA said.