On September 27, 2019, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation (collectively “the Agencies”) adopted a final rule increasing the threshold for requiring an appraisal in residential real estate transactions from $250,000 to $400,000. Federally related transactions under $400,000 will require an evaluation, rather than a full appraisal, to determine value of the real estate in question. A federally related transaction is a non-Fannie Mae or Freddie Mac transaction and a non-federal financed transaction, such as loans under the Federal Housing Administration, the Rural Housing Service or the Department of Veterans Affairs. Final Rule on Residential Threshold (link is external) The NAR position was to have these limits indexed like the GSE conforming loan limits. This should have minimal impact on the market, as the FHA and Fannie/Freddie follow old limits.
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