FHA announces updates to the Catalyst software assessment module

The Federal Housing Administration (FHA) announced Friday that it has updated the Electronic Appraisal Delivery (EAD) module of its Catalyst software platform, following the agency’s initial efforts to require appraisal submissions on the platform before returning them.

“Last weekend, [FHA] completed the implementation of new functionality in the FHA Catalyst: [EAD] module that eliminates the U.S. Department of Housing and Urban Development‘s (HUD) dependence on its legacy assessment processing system, the Loan Application Management System,” FHA said in an information notice.

The update “lays the foundation for modernizing the storage, dissemination and analytical capabilities of FHA’s assessment data,” the agency said, and brings them into line with the guidance of Mortgage Letter (ML) 2022-19, which “is now completely superseded by the Single Family Housing Policy Handbook 4000.1.”

FHA had previously outlined a plan that would require assessment submissions through the EAD module in 2021, but said in September 2022 that it had elected to reassess the module. The agency cited the need to take a closer look at the development and implementation of this part of the platform to streamline its efficiency.

With the publication of ML 2022-19, it ultimately rescinded the filing requirement. The agency also stopped “onboarding new mortgage borrowers and all activities related to the integration with FHA Catalyst: EAD Module,” the agency said at the time.

No new mandatory use date has been issued.

Catalyst is seen as a positive development in the ongoing efforts to modernize the technological infrastructure of federal housing agencies.

The creation of Catalyst was expected to allow for the retirement or consolidation of other legacy systems, saving taxpayers millions of dollars, according to a HUD Office of the Inspector General (OIG). report released in 2021.