Ensure balance between innovation, transparent standards and protection from undue risk in the housing finance system.
The private MI industry recognizes there are opportunities to modernize appraisal processes and improve the quality of residential property valuation practices. However, it is critical that there be appropriate transparency, monitoring, and governance. If done properly, collateral valuation and risk assessment can benefit from the significant advancements in technology, data aggregation, and analytics. Accurate valuations are of utmost importance for buyers and sellers, and have a material impact on risk within the housing finance system as the underlying valuations affect loan-to-value (LTV) ratios and the appropriateness of pricing and risk assessments. As the government-sponsored enterprises (GSEs) seek to modernize their valuation policies and technologies, it is critical there be a balance between innovation and the need for transparent standards and appropriate protections from undue risk in the housing finance system.