At first glance, the intent appears to solve issues where appraised values may be influenced by lending institutions or other parties involved in the mortgage and real estate transaction. However, a deeper look at the details in this agreement reveals language that ultimately hurts the consumer.
An official statement from the National Association of Mortgage Brokers (NAMB) about HVCC -
A revised HVCC released on December 23, 2008, by New York Attorney General
Cuomo is a de facto regulatory action, failing to follow necessary regulatory
procedure.
The Home Valuation Code of Conduct (HVCC), as written, goes too
far. It will impair consumer choice and impede competition, ultimately
costing consumers more money and hurting small businesses in a way simpler, more
effective, less burdensome solutions would not.
In a response from The Appraisal Press – HVCC: The Cure Is Worse Than The Disease, there are five major aspects which they believe will harm the appraisal industry and the consumer:
Under the HVCC, any lender using a professional appraiser incurs
substantial regulatory risks and additional costs, whereas AVMs, BPOs, and other valuation alternatives are expressly and repeatedly exempted from the same regulations and liabilities.
The HVCC unduly restricts the appraiser’s ability to operate a business
in the same manner as the other parties already in the transaction.
Lenders must be prohibited from owning or controlling, in whole or in
part, any sort of valuation entity or mechanism used in the origination of a loan.
All valuations, regardless of method employed, must be provided to the
borrower in the same manner.
Any complaints regarding the valuation process should be reported solely to the IVPI, not to the lender overseeing the origination.
What started with a 2007 lawsuit where Attorney General Andrew Cuomo sued an appraisal division of First American Corp. for allegedly inflating home values on an estimated 260,000 Washington Mutual loans between 2006 and 2007 has now been shifted to blaming street level originators and appraisers.
If revealing truth and transparency were the real motives behind this agreement, more stories would have been exposed where appraisers were pressured by developers and Appraisal Management Companies to bring in value.
The lending community is also sharing their disgust towards HVCC and how it is already hurting consumers and industry professionals.
It is vital for all mortgage and real estate professionals to get behind NAMB’s efforts to fight HVCC, regardless of whether you are a member of NAMB or not.Please add your name to the petition to repel the HVCC at http://www.hvccpetition.com/
Please contact your representative and ask for their yes vote on HR 3044, legislation that calls for an 18 month moratorium on HVCC.
THIS WEEKS NEWS:
Current Mortgage interest rates are stable, with little movement, but may trend slightly upward.
The S&P 500 was up 7.6% in July. The fifth consecutive month of gains.
Today's cover of Newsweek is declaring the recession is over. If so, the recession officially lasted 19 months, the longest since 1933.
The "Cash for Clunkers" program may be over already due to the high response. Were any of you able to take advantage of the program?
NFL training camps opened up last week. Will this be the year of the Leo's?
The Detroit Tigers showed they like home cooking much more than hotel food by going 2-4 on their 6 game road trip. Losing the series to bottom dwelling Cleveland could come back to haunt this team in September.
Tiger Woods easily cruised to the win of what appears to be the last Buick Open. Here's hoping that some company can step up and sponsor a great event that the PGA pros enjoy coming to. Even normally stoic Tiger looked like he was enjoying himself.
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