Real Estate Professionals Fed Up with HVCC
I have been speaking recently with many of my real estate business partners about their valid frustration over the Home Valuation Code of Conduct (HVCC) and how it unnecessarily jeopardizes transactions for homeowners and potential buyers.
The Federal Law imposed to protect consumers, as many others like it, is quickly becoming more of a burden then a benefit for the very consumer it is designed to protect.
There is an effort in the industry to encourage lawmakers to reconsider the HVCC. You can learn ore about the effort here and sign a petition that will be presented to lawmakers.
For those who may not be familiar with the code The Home Valuation Code of Conduct stipulates how appraisers, loan officers, lenders and real estate agents can handle the real estate appraisals in part it states that:
- A loan officer can NOT order the appraisal, and can not be involved with the selection of the appraiser;
- The lender must order the appraisal and must order it through a third party vendor (appraisal management company) that cannot be influenced by the lender, loan officer, appraiser or any other party to the transaction.
- If a second appraisal is needed it must be obtained from a second, unrelated, appraisal company.
The mandate of the institution of a third part vendor has caused a pricing shift. The cost of appraisals has not yet increased dramatically which means there is less of a profit now to be shared between the third party vendor (appraisal management company) and the actual appraisal company. The result is that appraisers with little or no experience are being used to reduce cost to the appraisal companies. Appraiser work loads are being increased and appraisers are working in unfamiliar markets/geographic areas.
Read more about the Home Valuation Code of Conduct here.
Sign the petition here.