MISMO Releases AVM Common Confidence Score Standard and Guidance for Industry Use

MISMO®, the real estate finance industry’s standards organization, released the Automated Valuation Model (AVM) Common Confidence Score Standard and Guidance. The new standard is designed to help mortgage originators and other stakeholders evaluate AVM risk more effectively and consistently, supporting industry-wide adoption and regulatory compliance.

“The AVM Common Confidence Score provides a standardized way to communicate the reliability of AVM-generated property valuations. This enables lenders to make more informed, risk-based decisions and fosters greater trust in AVM usage,” said MISMO Acting President Rick Hill. “The standard also supports AVM quality control standards finalized last year as mandated by the Dodd-Frank Act.”

Developed through collaboration with industry stakeholders, the guidance encourages preventive self-regulation in anticipation of future enforcement. While regulatory uncertainty remains, lenders have expressed strong interest in adopting the standard to improve operational efficiency and reduce costs.

Key Benefits of the AVM Confidence Score Standard include:

• Improved Risk Communication: Enables stakeholders to evaluate AVM reliability on a common scale.

• Regulatory Alignment: Supports compliance with Fair Lending laws and the Dodd-Frank AVM Rule.

• Standardized Testing Framework: Promotes consistent validation of AVM confidence scores across the industry.

MISMO’s work to solve key business challenges is made possible by its members, champions, sponsors, and lender support through the Innovation Investment Fee. Visit MISMO.org to learn how you can get involved.