We audited HUD’s management of its FHA appraiser roster to determine whether the roster was accurate and reliable.  We selected this review because a prior audit identified weaknesses related to roster oversight and because this topic aligns with HUD’s strategic goals related to promoting home ownership and strengthening its internal capacity, as well as increased interest in the appraisal process.  

HUD’s FHA appraiser roster was generally reliable.  HUD’s system controls prevented ineligible appraisers from being assigned appraisals on FHA-insured properties.  Though it did not affect the assignment of appraisals, HUD could improve its data management by timely removing ineligible appraisers with expired licenses or disciplinary actions within specified timeframes, and better maintain historical information and supporting documentation.  Additionally, HUD’s processes, policies, procedures, and regulations for maintaining the appraiser roster did not consistently align, were not clear, or were undocumented.  HUD had begun to make several system enhancements to address the concerns identified, and it should continue to improve its guidance and data management to help ensure the integrity of the roster.  

We recommend that HUD (1) update policies and procedures for appraiser roster management so that they align with each other and with regulations and HUD practice; (2) maintain historical appraiser roster data; and (3) improve quality assurance processes by adding steps to verify that the appraiser roster is accurate and reliable over time.