One veteran appraiser is reminding those in the industry that the deadline for changing over to UAD 3.6 is fast approaching
A November deadline is approaching that will change how appraisals in the mortgage industry are ordered, written, and delivered. The new Uniform Appraisal Dataset form, known as Form 3.6, replaces the current 2.6 version on November 2.
The topic was one of the major talking points at last week’s National Private Lenders Association event in Atlantic City. It is a front-of-mind topic for appraisers, lenders, and brokers.
For one appraiser, the move to 3.6 marks a major milestone that will require adjustment on both ends of the appraisal.
Noah Meier (pictured top), recently hired as chief appraiser at SingleSource Property Solutions, said the transition is the most consequential thing to happen to the appraisal industry in his career.
"From the time I became an appraiser in 2006 to now, this is probably the biggest change I've seen," Meier told Mortgage Professional America. "The deadline date of November 2nd, you should be fully converted well before then because that's the deadline to submit 2.6. Anything after that, you're going to have to convert it to a 3.6, basically starting the process over from scratch."
A more user-friendly appraisal
The right move is not to wait, Meier said. Some lenders have already started converting to avoid the crunch, and he recommended a full transition one to two months before the November deadline.
"It's important for lenders and brokers to be converted over a month, maybe even two months in advance," he said. "We're already seeing some lenders converting over now just to make sure that they're ready to go when it's time."
The form itself is a significant improvement for everyone who reads appraisal reports, Meier said. The current 2.6 form requires users to search through dense blocks of text to find specific information.
"From the intended user side, it's a much more friendly-to-read report than the ones we currently have," he said. "It has much more of a flow to it. You'll see that if you're looking for information on something, it's right below. If you're looking for that comment, it's going to be right there. You won't have to control-F and search through a page of text to find what you're looking for."
Meier said the software side of the transition has also cleared a significant hurdle. Appraisal software companies held back the broader conversion for some lenders and appraisers who were reluctant to switch before their preferred platform was ready.
"All of the major ones that have been around for a while now have GSE-compliant appraisal software," he said. "Hopefully that'll help the appraisers move forward and get to where they need to be so they're ready to start accepting the new assignments."
A major adjustment
The shift to Form 3.6 is accelerating two broader trends in the appraisal industry, AI adoption and workforce change. Meier said brokers should understand how the three connect.
Form 3.6 requires significantly more data to be embedded in each report, Meier said. That makes AI a more practical tool for appraisers working through larger data sets than what 2.6 required.
"There's going to be a greater reliance on AI with 3.6, with the amount of information they're looking for and the continued trend toward more data embedded in the reports to support the value conclusions," he said. "It's a valuable tool. But you can't just say AI said so. You have to understand the processes that go into the analysis that the AI is doing."
The inspection process itself will change, Meier said. Form 3.6 software will require appraisers to complete a full photo and data checklist before they can finalize an inspection, so missed items are flagged on-site rather than discovered after leaving the property.
On the appraiser workforce, Meier said the average age of a working appraiser has crept from the 50s toward 60 and retirement age. Regulatory bodies including the Practical Applications of Real Estate Appraisal program, known as PAREA, and the Appraisal Qualifications Board are adjusting entry requirements to bring new appraisers into the field.
Form 3.6 is likely to accelerate the generational shift, Meier said. Those willing to learn the new form and adopt AI as a working tool will find opportunity.
"If you're willing to adapt, you're willing to learn the new technology, you're willing to learn how to use AI as a tool, and you're willing to embrace 3.6, there's obviously still going to be a place for you in this industry," he said. "But I think those are almost requirements at this point."
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