Understanding UAD to Avoid Common Mistakes

Mar 03, 2012

Featuring Bill King Director of Valuation Initiatives

March, 2012 Podcast Transcript - Duration: 5 minutes

Moderator: Welcome to Veros Real Estate Solutions monthly podcast. Today Bill King, our director of valuation initiatives will provide some insight into common mistakes that are made when filling out UAD forms.

Bill: Thanks, Emily, I am glad to be here. UAD has been in place now for about six months and about two months ago FHA and VA adopted it as well. So I think appraisers are becoming accustomed to using it and getting comfortable with the UAD process.

Moderator: Appraisers are working hard to provide UAD compliant appraisals and have made big strides in incorporating it in to business flow. In what top three areas of UAD implementation are you still seeing the greatest challenges?

Bill: Well I think there are three things that are giving appraisers a little bit of challenge. Number one, appraisers have templates that they often use to begin preparation of their reports. And I think that some appraisers have not revisited their templates since the implementation of UAD. So there is still a little bit of conflicting information that’s coming through in some of their appraisal reports and so I encourage appraisers to review all of their templates especially in light of UAD. They should review the templates periodically, every six months or year at the outside to insure that the information that they include is up to date and reflects current practice.

Another area where I think appraisers may miss understand some of the intent of UAD has to do with the quality and condition in ratings. There are prescribed areas in the appraisal report where the quality and condition ratings are to be applied. And for example for appraisers that are using the 10-04 appraisal report form, there’s information on page one of that form that asks the appraiser to identify the materials that are included on the exterior of the home and the interior of the home and then also include their opinion of the condition. And those areas on page one of the appraisal report form have not been identified by the GSCs for UAD use.

So, it’s appropriate to continue using the terms that we used to use, average, good, fair, et cetera as opposed to GSC, UAD format in those areas. A third area is with the use of other in the preselected descriptions. For a lot of the fields, for example view, there are prescribed choices that appraisers can make and when none of the listed choices are most appropriate then they have the option of selecting other and writing in their description a description that reflects most accurately what they’re wishing to convey. And unfortunately some appraisers are selecting other, in style for example, or in location and then reverting back to old language. So they’re selecting other and writing average. Well that defeats the purpose of having created these drop downs in the first place. So when using other they need to be very clear about what other amenity or item it is that they wish to be describing.

Moderator: Great. Thanks, Bill. We have just a little bit of time left. Can you briefly from your professional perception tell us about the current success rate of UAD?

Bill: Well Moderator I can’t speak on behalf of the GSC but from my own perspective I think that UAD has without a doubt brought a much needed consistency to many areas of the appraisal report. I think this benefits appraisers, it takes some of the guess work out, they’ve set definitions that can be looked at for applying the information that they gather in the field. I think it’s good for the GSCs enabling them to collect uniform data and really get a better picture of what it is that these properties are like. And ultimately that translates to a consumer benefit in the form of better quality loans.

Moderator: Good. Bill thanks. This is all very good information to have on UAD we really appreciate your time and look forward to additional updates on UAD and other valuation related issues. For more information please visit as well as follow our Twitter handle, @VerosRES. Thank You.

Category: Podcasts