Friday, April 24, 2009

HVCC Update

Appraiser Active has provided quite a bit of information about the impending May 1, 2009 implementation of the Home Valuation Code of Conduct (HVCC). Most recent was the post describing the NAR effort to urge a one year delay of its effective date.

As of today, there has been no word from Fannie, Freddie or Attorney General Cuomo in response to the NAR letters.

However, we hear there are at least at TWO members of Congress are passing around a letter on the Hill that will also ask for a delay. It sound like NOW would be a good time to contact YOUR member of Congress to ask them to support the delay.

Use this LINK to locate your US Representative and Senators. Use your Zip+4. The contact information for each is provided along with a link to their webpage. At this stage of the game, it's best to a telephone call, fax or email to make your points.

Use whatever you like, the points made the NAR Letters or these suggestions:

  • One of the pillars necessary for implementation of the HVCC is the Independent Valuation Protection Institute. Without the IVPI there is no enforcement mechanism, hotline, or means of verifying compliance. Delaying implementation would allow creation of the IVPI or establishing an alternative framework

  • Many state legislatures are in the process of enacting laws to regulate Appraisal Management Companies. In other states, the regulatory agencies are in the process of promulgating rules and procedures to deal with Appraisal Management Companies. Delaying implementation would allow these states to finalize their actions

  • To this day, the fact that the HVCC resulted from improper influence on appraiser independence by a Federally regulated lender and a rogue Appraisal Management Company cannot be reconciled with the apparent endorsement of unregulated Appraisal Management Companies as the “protector” of appraiser independence by the HVCC. Delay would allow a reconciliation of this glaring conflict. (See Story on New York AG Complaint and link to suit HERE)

  • Fannie Mae has adopted policies that protect the brokerage fees from downward negotiation in certain transactions (short sales). Delay of implementation would permit efforts to protect appraiser’s fees from downward negotiation by Appraisal Management Companies. At the very least, it would allow time to arrange for full and transparent disclosure of valuation related fees in closing documents (AMC fee, Appraisal Fee, etc)

They meant for the acronym HVCC to be pronounced "havoc" right?