FNMA, FHLMC, FHA and AI - Oh My!
Written by: SCA Team
Uniform Appraisal Dataset (UAD) 3.6
Beginning November 2, 2026, FNMA and FHLMC mandate the utilization of Uniform Appraisal Dataset (UAD) 3.6 for all conventional and GSE-conforming loan appraisals. These changes are a transition from a more narrative format to a data driven format. The agencies do say that if Sellers need more time, they can request and obtain a temporary policy exception.
Some key changes:
retirement of some legacy forms including Form 1004 (residential) and Form 1073 (condo) which are being replaced by a dynamic Uniform Residential Appraisal Report (URAR) which is based on MISMO 3.6 standards.
data fields, codes, and numeric inputs for condition, quality, and room-level characteristics.
appraisers must document specific details such as green/energy-efficient features, zoning, distance to ground, materials used in any updates, and interior/exterior ratings.
Gross Living Are (GLC) terminology now requires precise metrics such as above and below grade finished areas.
Why the changes?
standardization of fields reduces the risk of human error and gray areas that can often lead to revision requests.
consistent reporting of data is captured and defined the same way regardless of where the property is located which provides better comparisons across different markets.
lenders and GSE’s will be able to utilize automated tools to perform deeper risk assessments allowing for faster identification of potential issues,, such as property eligibility or any valuations concerns.
Below is a link to some resources:
https://sf.freddiemac.com/tools-learning/uniform-mortgage-data-program/uad
FNMA Rental Income Changes
Effective on all loans with application dates on and after December 1, 2026, there are some new requirements for the use of short-term rental income, standardized requirements for investment properties purchased within 45 days of the subject property, new lease agreement standards as well as the utilization of reserve requirements and PITOA limitations rather than reliance on lease agreements.
For a more detailed explanation of policy changes and additional clarification please refer to the attachment. Https://singlefamily.fanniemae.com/media/48051/display
FHA, FNMA, FHLMC VantageScore 4.0
FNMA/FHLMC availability for all approved lenders to use and deliver VantageScore 4.0 took effect on September 9, 2026 on all securitized mortgages.
FHA will accept mortgage collateral backed by the VantageScore 4.0 credit scoring model starting January 1, 2027. The vendor is having a webinar on October 7, 2026.
COMING UP NEXT…..AI READINESS REVIEW, are you ready?
There isn’t a day that goes by without hearing or seeing the word AI. SCA’s Rob Ellis will be providing a weekly series where he will walk through the questions state examiners are now asking about AI and the investor rules that are already in force. Along the way, he will show you what and AI Readiness Review covers and why most institutions are not able to answer the basics yet.
