source:
  type: guide
  id: fnma-sel-b4-1.4-08
  authority: Fannie Mae Selling Guide B4-1.4-08 — Environmental Hazards Appraisal
    Requirements
  description: Fannie Mae Selling Guide B4-1.4-08 — Environmental Hazards Appraisal
    Requirements.
  coverage_tier: operative
obligations:
- id: fnma-sel-b4-1.4-08-full
  canonical_id: fnma-sel-b4-1.4-08-full
  section: Fannie Mae Selling Guide B4-1.4-08 — Environmental Hazards Appraisal Requirements
  type: do
  tags:
  - regulator-direct
  - fnma
  - selling-guide
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: Fannie Mae Selling Guide B4-1.4-08 — Environmental Hazards Appraisal
      Requirements
    source_class: fnma-guide
    source_url: https://singlefamily.fanniemae.com/media/document/pdf/selling-guide
    snapshot_id: 5f7b8b79da595d76
    fetched_at: '2026-05-25T14:09:57Z'
    content_hash: sha256:98cf85a02861bbe84914a0e339b327c8fc131869a8a573882007bbeea60c5701
    paragraph_quote: 'B4-1.4-08, Environmental Hazards Appraisal Requirements (06/04/2025)
      Introduction This topic contains information on special appraisal considerations
      for properties aﬀected by environmental hazards, including: Overview Appraisal
      Requirements Lender Requirements Uniform Appraisal Dataset (UAD) 3.6 Policy
      Overview Fannie Mae purchases or securitizes mortgage loans secured by properties
      aﬀected by environmental hazards if the eﬀect of the hazard is measurable through
      an analysis of comparable market data as of the eﬀective date of the appraisal,
      and the appraiser reﬂects in the appraisal report any adverse eﬀect that the
      hazard has on the value and marketability of the subject property or indicates
      that the comparable market data reveals no buyer resistance to the hazard. In
      rare situations, a particular environmental hazard may have a signiﬁcant eﬀect
      on the value of the subject Published May 6, 2026 610 property, although the
      actual eﬀect is not measurable because the hazard is so serious or so recently
      discovered that an appraiser cannot arrive at a reliable opinion of market value
      because there is no comparable market data available, such as sales, contract
      sales, or active listings that are available to reﬂect the eﬀect of the hazard.
      In such cases, the mortgage will not be eligible for delivery to Fannie Mae.
      Appraisal Requirements When the appraiser has knowledge of any hazardous condition,
      whether it exists in or on the subject property or on any site within the vicinity
      of the property, including but not limited to, the presence of hazardous wastes,
      toxic substances, asbestos-containing materials, urea-formaldehyde insulation,
      or radon gas, the appraiser must note the hazardous condition in the appraisal
      report; comment on any inﬂuence the hazard has on the property’s value and marketability,
      if it is measurable through an analysis of comparable market data as of the
      eﬀective date of the appraisal, or indicate that the comparable market data
      reveals no buyer resistance to the hazard; make appropriate adjustments in the
      overall analysis of the property’s value; and make the appraisal "subject to"
      inspection by a qualiﬁed professional. Fannie Mae expects the appraiser to consider
      and use comparable market data from the same aﬀected area because the sales
      prices of settled sales, the contract sales prices of pending sales, and the
      current asking prices for active listings will reﬂect any negative eﬀect on
      value and marketability of the subject property. Note: Fannie Mae does not consider
      the appraiser to be an expert in the ﬁeld of environmental hazards. The typical
      residential real estate appraiser is neither expected nor required to be an
      expert in this specialized ﬁeld. The appraiser, however, has a responsibility
      to note in the appraisal report any adverse conditions that were observed during
      the inspection of the subject property or information that they became aware
      of through the normal research involved in performing an appraisal. Lender Requirements
      Fannie Mae requires the lender to disclose any information regarding environmental
      hazards to the appraiser and note the individual mortgage ﬁle accordingly if
      the real estate agent, the property seller, the property purchaser, or any other
      party to the mortgage transaction informs the lender that an environmental hazard
      exists in or on the property, or in the vicinity of the property. Fannie Mae
      also requires the lender to disclose such information to the borrower, and to
      comply with any state or local environmental laws regarding disclosure. The
      lender must make the ﬁnal decision about the need for inspections and the adequacy
      of the property as security for the mortgage. For example, because Fannie Mae
      requires the appraiser to comment on the eﬀect of a hazard on the value and
      marketability of the subject property, the appraiser would have to note when
      there is market resistance to an area because of environmental hazards or any
      other conditions that aﬀect well, septic, or public water facilities. When the
      lender has reason to believe that private well water that is on or available
      to a property might be contaminated as a result of the proximity of the well
      to hazardous waste sites, the lender is exercising sound judgment if it obtains
      a “well certiﬁcation” to determine whether the water meets community standards.
      Published May 6, 2026 611 Uniform Appraisal Dataset (UAD) 3.6 Policy Lenders
      using UAD 3.6 must follow the requirements in the UAD 3.6 Policy Supplement.
      Recent Related Announcements The table below provides references to recently
      issued Announcements that are related to this topic. Announcements Issue Date
      Announcement SEL-2025-04 June 04, 2025 Announcements SEL-2023-02 March 01, 2023'
  judgment: false
