Can AI sign an appraisal?
The question sounds futuristic. The answer is mostly about paperwork, licensing and 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 requirement is framed around a person from the start.
The wider system is built 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. There is no entry for a model.
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.
A signed report is where the appraiser takes ownership of the work. A model can be retrained or retired. It cannot lose a credential, answer a complaint or explain its reasoning to a reviewer in a way that carries professional consequence.
Can an appraiser use AI while preparing the report?
Yes, and federal regulators have said as much, with an important condition attached.
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 conclusion has to stand on evidence the appraiser can defend.
How is help from others disclosed in a report?
Fannie Mae already has a pattern for assistance, though it is written about people rather than 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. How, or whether, tool use should be described in a report is a question worth watching as the software gets more capable.
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.