The anniversary date for the Home Valuation Code of Conduct (effective date May 1, 2009), came and went with no notice. No fanfare. No parade.
I don’t think I am alone in wondering if we aren’t already working towards HVCC, Part Deux. I, in fact, know I am not alone. The results of our recent Appraisal Buzz poll on Appraisal Independence is a great barometer that indicates pressure is still a problem. Nearly half of our respondents say nothing has changed. See Appraisal Buzz Poll Here.
In 2007 over 60,000 appraisers signed a petition praying for relief from mortgage brokers and loan officers who were exerting pressure upon appraisers to inflate values. That petition got the attention of the New York Attorney General, Andrew Cuomo. The resulting Home Valuation Code of Conduct was an agreement to which Fannie Mae and Freddie Mac and their regulator agreed, to ensure that loan production played no role in the ordering, selection, or nomination to a panel. HVCC was sunset and the provisions of appraisal independence were rolled into Dodd Frank.
I haven’t been able to find any announcement by either Federal Housing Finance Agency (FHFA) or the Government Sponsored Enterprises (GSEs) of any enforcement actions. HVCC was sunset and became Appraisal Independence under Dodd Frank. Have you seen any enforcement actions against lenders by bank regulators? By the CFPB? Has there been any reporting by ASC of incidences of their use of the “hotline”? Has the Appraisal Foundation been proactive about preserving the public trust?
I know I have more questions than answers. We rely on you to tell us what is going on at the street level. So don’t be shy.
As interest rates rise, sometime deals become uglier and uglier. In a rising market, the pressure to inflate values dissipates. Just keep your eye out for abuses of seller concessions to disguise “grossed up” sales prices.
Here is the link to report violations of Appraisal Independence:
Or please email me at firstname.lastname@example.org and I will forward them to the proper authorities. But I must have documentation.
Be careful out there.
Have content of your own that you would like to submit? Email email@example.com.