Ever Heard of HVCC? Neither Had I.

I’ve received a few emails as of late about my my thoughts on HVCC (Home Valuation Code of Conduct) and why I hadn’t written or documented HVCC the way we did HR3915. The truth is that it slipped by me until I got up to speed on the ramifications of HVCC today, even though Paul covered it previously, here. I even remember reading his post, but for some reason the implications didn’t hit until the last day or so. While HVCC serves to do some great things for consumers and the industry, in its current form its negative aspects overshadow the good it does for agents, brokers, consumers, and appraisers.

On Wednesday, the 30th, the feedback period for HVCC is over, so now is the time to express how you feel about the flaws in HVCC. Since HVCC is a bill or legislation going through the Senate and House, it has gotten little to no coverage, whereas if it was a bill, I believe there would be a much larger discussion taking place online and off. Although I am acutely aware that a petition with less then 36 hours to gain momentum is not unlike throwing a life preserver to somebody who’s already 20 feet under water, I still ask in your support in signing the petition. Even though the feedback period is ending, this doesn’t mean that all ears will be closed.

HVCC Basics:

  1. Disables Brokers from choosing appraisers or having ANY contact with appraisers as these tasks are delegated to lenders. This creates a bias that shifts power to large institutions.
  2. Requires independent appraisers to join AMC’s (Appraisal Management Companies) where they are forced to pay 40% or more of their income to the AMC, ending the existence of independent appraisers.
  3. Since appraisals are not in the Broker’s name but the Lender’s, if you or your client needs to change lenders, a new appraisal is required.
  4. If consumers want to shop their loan, they must pay for a new appraisal, they cannot have appraisal reassigned. This creates a disincentive to shop for the best deal, which is never good for consumers.

In Depth HVCC Analysis

UPDATE: Alamode Petition

Alamode CEO, Dave Biggers sent out this email this Morning:

Thank you for submitting your letter to Fannie, Freddie, OFHEO and Attorney General Cuomo yesterday. We understand you may have received a “bounce back” e-mail from one or more of them indicating your electronic submission wasn’t received. Trust me, they got the message.

Yesterday over 16,000 appraisers, mortgage brokers, agents and even lenders (178 of them) logged in and sent their opposition to the HVCC. Apparently the volume caused the servers at Fannie, Freddie and OFHEO to start shutting down. To their credit, Fannie Mae called us proactively and we believe we’ve worked out a compromise that’s easier on their servers, but we haven’t been able to reach technical contacts at OFHEO and Freddie.

We’ve queued all the mail however and will resend as soon as all three have their servers in order and are able to accept the messages and/or posts.

We were surprised that their mail servers coughed up so quickly. We had a little over 10,000 people sign up in the first six hours, and 10,000 messages each should be nothing to these guys. We handle millions of messages a day on our mail servers, with no impact at all. If someone sent us 10,000 messages over six hours, it wouldn’t even register as a blip on our volume monitoring tools.

Regardless, we’re also taking the “official” method and sending paper copies to all the entities. Right now, at more than 17,000 signers, that means over 68,000 pages to print (some span two pages). Last night we printed 55,000 of them and will keep up with the volume as it goes today.
Again, thanks to everyone for all the support. I’m confident we’ll emerge with a set of rules we can live with, rather than die by.

Trace is the founder of LeadPress and helps loan officers generate mortgage leads and learn with FREE Mortgage Tools.