Appraisal Agreement (HVCC) to be Delayed


September 25, 2008

Associated Press

An agreement to reshape the appraisal industry is being delayed up to three months, a federal regulator said Thursday.

James Lockhart, director of the Federal Housing Finance Agency, told the House Financial Service Committee that the agreement with New York Attorney General Andrew Cuomo is still being worked out.

Lockhart said the agreement will be delayed by one to three months from it’s original Jan. 1 start date. While the agreement should be finalized in the coming weeks, “it’s taken us longer than we expected to do it,” he said.

Widespread complaints of problems with the appraisal process and its impact on the nation’s housing market led Cuomo to reach a deal in March with Fannie Mae and Freddie Mac, which are regulated by Lockhart.

The agreement will create a watchdog – the Independent Valuation Protection Institute – to monitor the appraisal business. Fannie Mae and Freddie Mac will spend $24 million to create the institute, which will accept complaints from consumers and appraisers. It will also monitor the enforcement and report to Cuomo’s office.

Earlier this year, federal bank regulators and mortgage industry interests protested the agreement, saying it violates federal law and could have an unintended negative impact on the mortgage industry.

If you are a lender, especially a mortgage broker, I hope that you are familiar with the Home Valuation Code of Conduct (HVCC). This will drastically change the way real estate mortgages are done. Call or e-mail me with any questions on the appraisal side of the regulation. Integra and IRR-Residential have several scenarios that may prove to be very beneficial to mortgage lenders.
Mike Dodds

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