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Are Final Inspections considered to be “revised appraisals” and fall under the timing requirement for providing appraisals? After an internal review, this was brought up to us and I have never heard this before. Also on HPML loans, it is stating that all appraisals, revisions including clerical and any final inspections must be provided before the CD goes out.
After reviewing Fannie and Freddie rules as well as the CFPB appraisal requirements. these are defined as two separate actions. Definitions state a home appraisal is an estimate of a home’s fair market value. A home inspection is a thorough inspection of a property that determines the condition of the property and reveals any repairs that need to be made. The key difference between appraisal and inspection is the appraisal focuses on the home’s value, while the inspection focuses on the home’s condition. Additionally, most final inspections are done because either (1) the home is new or being remodeled; or (2) the home has FHA or other deficiencies.
As far as the HPML appraisals rules – An FI is required to deliver copies of any appraisals to covered applicants no later than three business days before the loan is consummated. It doesn’t speak to the CD requirements BUT clearly states no later than three business days before the loan is consummated.
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