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Important Updates

March 7, 2011: Fannie Mae 2055 vs. 2065
March 7th, 2011 10:29 AM

Fannie Mae 2055 Quantitative Analysis Report. Most commonly used by lenders and is based on adjusted sales price of comparable sales.

Fannie Mae 2065 Qualitative Analysis Report. Less frequently used by lenders and is based on plus or minus ratings/rankings of comparable sales. Whole dollar adjustments are not made on this form.

The logic is that the qualitative analysis is more similar to the manner in which the open market determines value. Typically market participants do not make dollar adjustments for differences the way appraisers do in the more traditional "quantitative" analysis. Conversely, the market simply rate/rank the comparable sales to the subject property. This method is more of a "qualitative" analysis with no dollar amounts used in the analysis.

Theoretically, there will be less time associated with the "qualitative" analysis. However, that may not always hold true if such lengthy narrative is warranted. I am of the opinion this may hold water in densely populated areas and may not be suitable for some suburban/rural areas.

At the end of the day, it is the appraiser's responsibility to determine which analysis is most suitable and applicable. Regardless, the "quantitative" analysis will be more reliable than the "qualitative" analysis. As with all assignments, this should all be discussed and disclosed within the appraisal certification and limiting conditions.

Posted in:General
Posted by Douglas E. Hendricks on March 7th, 2011 10:29 AMPost a Comment

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