McMillan notes that "There are many benefits for consumers and real estate practitioners to delaying the effective date of the HVCC until May 1, 2010. Stakeholders across the country will be granted sufficient time to prepare for changes to the appraisal process brought forth by the HVCC. He asks that the implementation be delayed to allow for several outstanding issues to be addressed.
- Lack of Guidance
- State Regulating AMCs
- HVCC does not Apply to FHA
- HVCC May Increase the Cost of Real Estate Transaction
- Lenders are not Prepared for HVCC
- No Clear Enforcement Agency
- IVPI is not Yet Functioning
With respect to the Independent Value Protection Institute, President McMillan states: "The Independent Valuation Protection Institute (IVPI) was announced as part of the HVCC to receive complaints from appraisers and users of appraisal services on the improper influence or attempted improper influence of appraisers. In the original agreement between the GSEs and the New York State Attorney General, Andrew Cuomo, $5 million was to be paid by Fannie Mae and Freddie Mac to fund the first 5 years of the Institute’s existence. The final agreement includes the IVPI but makes no mention of funding. It’s not clear whether the GSEs will provide the upfront funding and long-term funding was never addressed in the HVCC.
In our comments provided on April 30, 2008, we recommended the Independent Valuation Protection Institute be affiliated with an already existing appraisal organization. This will help to ensure that the code is implemented to add value to the appraisal process rather than becoming a duplicative layer of bureaucracy. Under the final agreement of the HVCC, the lender, rather than the IVPI, is responsible for establishing a telephone hotline to receive complaints from appraisers, individuals, or any entity concerned with the improper influencing of appraisers or the appraisal process. Lenders report any improper activity to the IVPI and the state regulating agency. If properly implemented, the code will complement, rather than duplicate or contradict, already existing appraisal codes such as the Uniform Standards of Professional Appraisal Practice (USPAP). Further, the IVPI will be better positioned to work with appraisal organizations and state regulatory agencies to ensure the independence of appraisers and the integrity of the appraisal process.