HVCC--A bad idea who's time has come, to go away

The first month of the new HVCC appraisal rules have certainly been entertaining. A petition is circulating, http://www.hvccpetition.com/ . Everyone in Real Estate should sign this even if you think the new rules are a good idea, that means you Mr. Cuomo because this thing is FUBAR. Here's some of the text ( not of my own making ) from an email I received and forwarded to my sphere of influence last Friday:

This is NOT an Appraisal problem, it's an APPRAISER issue. Regulating the entire industry at a higher cost to the consumer is not a better answer than dealing with the "Few" appraisers or lenders who are not ethical and/or following the current rules. HVCC has created an environment where inexperienced appraisers are completing substandard work with a middle man (AMC's) adding no value to the process. The entire HVCC process results in poor service, poor appraisals and slower turn times for the consumer.


It was a long email but it had some great points. One in particular, the "system" doesn't work, period. If a lender is relying on an AMC then they are continuing the problem. A broker I used to work for said today his appraiser is still getting orders demanding a specific value or the deal won't "work". Exactly the thing that was supposed to be stopped.

All of us are now dealing with long order times, flat out rejection of orders, or having reports generated by an appraiser from out of the area. This last issue is especially troubling because of a value is being established by someone that is unfamiliar with the market. This isn't a new problem, it was happening before. It's just magnified by the restrictions in the new rules.

Appraisers coming from scores of miles away where they likely don't have access to the MLS system to determine sold values. And even if they do have access to the local MLS an out of town appraiser won't have an understanding of the subject property's market. The appraiser in closest proximity to the subject property is supposed to get the order. But if a lender doesn't have an appraiser in their system that is located in the same town as the subject home then an out of towner gets the work. Agents love getting phone calls from out of town appraisers. Go ahead ask one about that, it will be a lively conversation.

No doubt there was abuse, collusion and other nasty things going on before. Thanks to WAMU, Countrywide and their respective wholly owned appraisal companies for making every one's life a little more difficult than it should be. If it wasn't for these two (now extinct) company's abuses Loan Officers would still be able to manage one of the most important parts of a transaction. HVCC has outlawed communication between loan officer and appraiser. Sign the petition, write your congressional representative. HVCC is a knee jerk reaction.