In an effort to make the housing finance system more transparent and streamlined, one government-sponsored enterprise recently announced it and it's sister company planned to adopt a new way to standardize data shared between mortgage lenders and appraisers.
The Uniform Mortgage Data Program and Uniform Appraisal Dataset are scheduled to go into effect at Fannie Mae and Freddie Mac as soon as possible, one expert from Freddie said. It's believed these two initiatives will improve data quality and enhance risk management capabilities for the companies.
"We know that this will require significant time and investment from our servicers, so we plan to work closely with them and our vendors during the development of the specifications to ensure that data collection phases are feasible," said Freddie Mac vice president of single-family customer and technology data offerings Sam Oliver.
Meanwhile, the Uniform Appraisal Dataset will specifically standardize the way professionals provide descriptions of certain properties and comparable homes, creating greater clarity for appraisal reports. With this property data, lenders should be able to compare real estate standards and trends in local markets to ensure a loan is for an appropriate amount.
Should these initiatives prove successful, they could become industry standards for more than just loans backed by Freddie Mac and Fannie Mae in the near future.