Greg Rutolo | Loan Factory

Buying (or Selling) a Home in the UAD 3.6 Era: What 2027 Borrowers Need to Know
If you are planning to buy or sell a home in 2027, there is a major behind‑the‑scenes change. It is happening in the appraisal world and it will affect your experience: UAD 3.6. You won’t see that phrase on your Loan Estimate or your listing agreement. However, you will feel it in how your appraisal is conducted and in how long it takes and how your home’s value is evaluated.

How This Might Help You as a Borrower

1. More consistent and explainable values
   One of the biggest frustrations buyers have is when an appraisal comes in lower than the buying price. No one can clearly explain why this happens. With UAD 3.6, appraisals have:
   • More structured data about the property’s condition, features, and updates.
   • Clearer fields for how and why adjustments are made between your home and comparable sales.
   This gives lenders, regulators, and you a better foundation to understand the valuation. You can question it when something truly looks off. You can also support a well‑documented reconsideration of value when appropriate.
2. Better recognition of modern home features
   Many current appraisals do not meaningfully capture things like:
   • Energy‑efficient upgrades (insulation, windows, HVAC, smart thermostats).
   • Solar panels and battery storage.
   • Accessibility features, ADUs, and multi‑generational layouts.
   • Home office build‑outs or high‑quality finished basements.
   The new standard was designed to record these features more explicitly through expanded fields and room‑level and component‑level detail. That does not guarantee a dollar‑for‑dollar value bump. However, it does increase the odds that what you care about—and what you paid for—is at least visible. It’s considered within a more consistent framework.
3. Stronger tools to monitor and reduce bias
   Regulators and the GSEs are placing more emphasis on valuation fairness. They are also focusing on appraisal bias. A richer, standardized dataset makes it easier to:
   • Identify patterns of inconsistent valuations across neighborhoods or demographics.
   • Enforce guidelines around fair housing and equal treatment.
   As a borrower, this is a step toward a more transparent valuation system. This is especially true if you are buying in an under-served or historically undervalued area.

New Section: Steps for Homeowners. This is for those Who Plan to Sell in 2027.
If you plan to sell in 2027, your buyer’s lender will almost certainly be using the new UAD 3.6‑based appraisal. Your goal is to make it easy for that appraiser to see—and document—the true condition and features of your home.
Here are practical steps to take now:

1. Build your “home improvement dossier”
   • Create a simple list of major upgrades and repairs. Include items like the roof, HVAC, plumbing, electrical, windows, kitchen/bath remodels, structural work, and moisture remediation.
   • Gather supporting documents such as invoices, permits, warranties, energy audits, solar agreements, or builder specs. This ensures improvements can be clearly documented. Use the new, more detailed format.
   • Make sure basic facts (bed/bath count, finished square footage, ADU or basement finish) are consistent across public records, MLS, and your own documentation. Verify that UAD 3.6 ties physical details more tightly to the data used in risk analysis.
2. Prepare for a more granular inspection
   Appraisers using UAD 3.6 are expected to report more detailed interior and exterior condition, often at the room or component level. To prepare:
   • Focus on high‑impact areas, such as kitchens, bathrooms, main living spaces, and visible exterior. Declutter these areas. Perform a deep cleaning. Tackle obvious cosmetic issues.
   • Ensure full access to all spaces. This includes the attic, crawlspace, garage, and mechanicals. Include finished and unfinished areas, ADUs, and outbuildings. This is necessary since more comprehensive data is required.
   • Fix visible deferred maintenance. This includes peeling paint, broken steps, leaks, missing handrails, and damaged flooring. Otherwise, these issues will be called out in more precise condition fields.
3. Highlight features UAD 3.6 captures better
   The updated dataset includes more fields for features that historically flew under the radar. Make sure your agent is aware of certain features. Indirectly, inform the appraiser about:
   • Energy‑efficient elements: upgraded HVAC, high‑performance windows, added insulation, tankless or high‑efficiency water heaters, smart thermostats, solar panels, or battery storage.
   • Functional and lifestyle features: finished basements, bonus rooms, ADUs, accessibility upgrades, multi‑gen suites, home offices, and outdoor living spaces.
   • Any unique characteristics that clearly differentiate your home from typical comps in your neighborhood.
   These don’t guarantee higher value. However, the new standard gives appraisers a clearer way to document them. That’s the first step to having them properly weighed in the market.
4. Coordinate with your listing agent’s appraisal strategy.
   Your listing agent can quietly do a lot to help the appraisal reflect reality. They can do this without trying to “influence” the appraiser. In a UAD 3.6 world, that looks like:
   • Pricing and positioning the home with the new, more data‑driven appraisal environment in mind. This is especially crucial in markets with limited or quirky comps.
   • Preparing an appraiser‑friendly information packet. This packet should include the MLS sheet. It should have key comparable sales with notes. Include your improvement list, HOA docs, and any surveys or plats. The documents need to align with how the property is actually configured.
   • Be available to answer factual questions about the property. Do not argue value. Ensure the appraiser has any needed access and info in a timely way.
   Sellers will be best positioned in the new appraisal environment if they combine realistic pricing with strong documentation. They also need a well‑prepared property.

Where You May Feel Friction as a Buyer

1. Appraisal timelines—especially early in the transition
   Any major industry change brings a learning curve. As UAD 3.6 becomes fully mandatory and lenders refine their processes, you may see:
   • Slightly longer appraisal timelines in certain markets.
   • Occasional rescheduling of appraisal inspections.
   • More follow‑up questions or clarification requests between the lender and the appraiser.
   This could mean for you: “We’re still waiting on the appraisal.” It could also appear as: “The appraiser had to update the report.” These situations occur even when everyone is doing their job correctly.
2. More appraisal‑related conditions on your loan
   Because the data is more structured, the automated checks are more sophisticated. Your loan file might get additional collateral conditions when something in the report doesn’t line up with market data. It might also occur if it doesn’t align with the rest of your application.
   That can feel like extra scrutiny. In reality, the system is using more data to ask better questions. This happens before your loan is sold into the secondary market.

What You Can Do as a Future Borrower

You cannot control the new standard. However, you can make it work for you instead of against you:
• Choose a loan officer and agent who understand UAD 3.6 and have a plan for appraisal issues.
• Help ensure the property is accurately presented and accessible for the appraiser.
• Use your lender’s formal reconsideration process if the value appears clearly unsupported or factually wrong.

The Big Picture for 2027 Buyers and Sellers
For most people, “UAD 3.6” will just sound like technical jargon. But behind the scenes, it will quietly reshape your appraisal experience. Over time, you should see:
• Valuations that are more consistent and better documented.
• Stronger recognition of the features that matter in a modern home.
• Fewer outright errors and clearer explanations when a value doesn’t match expectations.
If you’re planning to buy or sell in 2027, ensure you have support from knowledgeable professionals. They should be preparing for this shift. They can guide you through a more data‑driven, transparent appraisal process.