Can AI sign an appraisal?
The short answer is no. It comes down to licensing, and to who a state board can hold responsible.
Can an AI system sign an appraisal report?
No. In mortgage lending, the signature on an appraisal belongs to a state licensed or state certified appraiser, and software holds no license.
Fannie Mae's appraisal report forms identify the appraiser as the individual who performed the analysis, prepared the report and signed it. The forms assume a person from the start.
The wider system works the same way. The Appraisal Subcommittee oversees state appraiser regulatory programs for federally related transactions and maintains a national registry of appraisers. A registry lists people with credentials. A model has no entry.
What does the signature commit the appraiser to?
It attaches a named, credentialed person to the analysis and the conclusion, so there is someone to question, review and, if needed, discipline.
That person works under USPAP, which The Appraisal Foundation describes as the national standards for real estate appraisal. Its Appraisal Standards Board updates the standards as needed; the foundation lists the 2024 edition as current.
By signing, the appraiser owns the work. A model can be retrained or retired. It cannot lose a credential, answer a complaint or face professional consequences for its reasoning.
Can an appraiser use AI while preparing the report?
Yes. Federal regulators have said so, on one condition: the value has to stand without the model.
In the 2024 interagency rule on automated valuation models, the agencies noted that appraisers may use these models when preparing appraisals. They added that the appraiser must still achieve credible results under USPAP, so the value conclusion has to be supportable independently and not rely on the model.
That is probably the clearest official statement of where the line sits today. The tool can inform the work. The conclusion has to rest on evidence the appraiser can defend.
How is help from others disclosed in a report?
Fannie Mae has rules for help from other people. They say nothing about software.
Under its appraiser selection criteria, a trainee or an unlicensed or uncertified appraiser may perform a significant amount of the work. The licensed or certified appraiser who signs must acknowledge in the report the extent of the professional assistance and the tasks each individual performed.
The guide section does not mention automated tools. Whether a report should describe tool use, and how, is still an open question.
Common questions
Is an AVM report an appraisal?
Could a supervisor sign for work a model did?
Does the 2024 AVM rule change who signs?
- Where AI fits in property valuationThe homepage overview of what models do well and where they stop.
- The federal AVM quality control ruleWhat the 2024 interagency rule asks of lenders, and what it leaves out.
- Where AI helps an appraiser todayPhoto review, data checks and comparable search, with the appraiser deciding.
- Bias and fairness in automated valuationWhat federal agencies have said about models and fair housing.
Sources
- Selling Guide B4-1.1-03, Appraiser Selection Criteria. Fannie Mae.
- Uniform Standards of Professional Appraisal Practice (USPAP). The Appraisal Foundation.
- Appraisal Subcommittee home page. Appraisal Subcommittee of the FFIEC.
- Quality Control Standards for Automated Valuation Models, final rule, Federal Register Vol. 89, No. 152 (August 7, 2024). OCC, Federal Reserve Board, FDIC, NCUA, CFPB and FHFA, via GovInfo.