Class Valuation recently launched Class Valuation Underwriting Engine (CVUE), an underwriting and appraisal assurance program designed to reduce lender risk, lower operational costs and accelerate loan closings, according to a company release.
One of the most persistent operational challenges in mortgage lending is reviewing every appraisal received from an AMC or appraiser regardless of the underlying risk score. Manually reviewing low-risk files adds unnecessary time and expense and reduces underwriting throughput.
Class Valuation points out that compounding the issue, roughly one in four appraisals is returned for revision during underwriting, adding an additional one to three days to closing timelines. CVUE addresses these inefficiencies by combining AI analysis and human review to deliver guaranteed appraisals lenders can accept without an internal review.
CVUE covers eligible appraisals with repurchase risk defense and financial protection. By assuming repurchase risk on qualifying files, the program removes an estimated 80 percent of the appraisal review burden typically placed on underwriting teams, saving lenders roughly $100 per file while freeing teams to focus on higher-risk loans and scale production without adding staff.
CVUE also eliminates appraisal revisions and shortens appraisal turn times by an average of two to three days, resulting in faster closings and improved pipeline predictability. These results have been validated through a pilot with more than 20 lenders, including three of the nation’s top 10.
Additionally, CVUE's guarantee generally applies to low-risk appraisals, which based on Class Valuation's data represent approximately 80% of appraisal volume. This includes conforming purchase and refinance first mortgages sold to Fannie Mae and Freddie Mac as well as FHA-insured loans guaranteed by Ginnie Mae. All loans must pass Class Valuation’s internal quality control review to qualify.
“For the first time, an AMC is stepping in front of the risk and standing behind its appraisals. That’s what CVUE does,” John Fraas, chief executive officer of Class Valuation, said in the release. “After piloting the program, we’ve proven that lenders don’t need to review every appraisal to protect against buyback exposure. Class Valuation assumes that risk on qualifying files, giving lenders certainty of execution, a dramatic reduction in underwriting workload and fewer delays caused by appraisal revisions.”