Saturday, March 21, 2009

HVCC - NAMB Lawsuit Update


Appraisers, real estate brokers and mortgage brokers have been anxious to hear the status of the lawsuit filed by the National Association of Mortgage Brokers (NAMB) against Federal Housing Finance Agency (FHFA) Director James B. Lockhart over the Home Valuation Code of Conduct (HVCC). In an email to members and supporters, NAMB President, Marc Savitt, says:





As you know, on February 23, 2009, NAMB filed a lawsuit against the Federal Housing Finance Agency (FHFA) over the controversial HVCC included in agreements between New York Attorney General Andrew Cuomo, Fannie Mae and Freddie Mac (GSEs), and their regulator, the FHFA.


This week, the litigation took a major step forward as NAMB filed its initial brief outlining why the HVCC is unlawful and should be disallowed. The 45 page document was supported by numerous affidavits, exhibits, and other materials which demonstrated the grave problems created by the HVCC. NAMB is asking the U.S. district Court for the District of Columbia to take any one of several actions that would invalidate the HVCC. As expected, the court declined to rule immediately that the HVCC should be withdrawn without first permitting FHFA to present its arguments, and thus the court has denied NAMB’s request for an immediate Temporary Restraining Order. However, in doing so, the court expressly reserved judgment on the merits of NAMB’s position, which the court has yet to address.


What does this mean?


The District Court may block implementation of the HVCC through an immediate Temporary Restraining Order (TRO), a Temporary Injunction, or a Permanent Injunction. A TRO is rarely granted—it requires a showing that a party faces immediate and irreparable harm if a TRO is not granted and, when granted, typically is in effect only for a matter of days. Because the District Court did not find that there would be immediate and irreparable harm done to appraisers or mortgage brokers within the next few days if a TRO was not granted, the court ruled that a TRO was not appropriate.


That decision does NOT mean that the District Court denied NAMB’s claim. To the contrary, the litigation is now proceeding to the next stage, when NAMB will have an opportunity to present its case to the court, which will then make a ruling.


NAMB has requested an expedited hearing process given the close proximity of the HVCC effective date. NAMB continues to seek both a temporary injunction and permanent injunction blocking implementation of the HVCC, and is seeking resolution of the matter in the coming weeks.


Savitt continues: "Despite the initial good news, there is much more to be done! NAMB is so grateful for your support thus far, but we still need your help! Please continue to circulate the donation letters to appraisers.


As information becomes available, we'll make sure to pass it on. Don't be shy about making a contribution to the NAMB effort by using the link above.

More information at FHA Appraisers.com in their NEWSLETTER

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