Dear Mortgage Client

I want to make sure you are aware of the recent appraisal changes in the mortgage industry as a whole.  While these changes don’t alleviate the frustrations Lenders and their borrowers are all having as a result of this new process, they do shed some light on why things are taking so long.

There have been many Newspaper reports recently on the Home Valuation Code of Conduct (HVCC). This is an agreement between the Attorney Generals office in New York and Fannie Mae and Freddie Mac which has affected the appraisal process in every state across the country not just New York.  The Code stipulates that Fannie Mae and Freddie Mac will no longer purchase mortgages where the appraisal was ordered, reviewed, commented on, or in any way had the originator directly involved in any part of the appraisal process.

As you can imagine, this is a huge impediment on the mortgage approval process.  Because of this new Code, we are all left in the dark somewhat…  The underwriters of the loan have to address any appraisal needs through 3rd party Appraisal Management Companies which delays the entire application review.  This system is also using out of area Appraisers who are coming in with low values.  A Baltimore appraiser should not be appraising anything in Montgomery County. 

While we have great relationships with our wholesalers, we work very closely with them to extend lock commitments when necessary. Unfortunately, the HVCC has delayed thousands of settlements and has cost consumers millions in lost locks and higher appraisal fees. It has extended normal underwriting times from days to weeks.  Sometimes inhibiting your loan officer’s ability to time the market for rate locks.  We are doing everything possible to move applications through the proper channels as quickly as we can.

Here is a Call to Action by the NAMB, our industry association. You can see from reading this material, this is a problem everywhere with every loan file. Hopefully, they will overturn the Code, reinstitute our ability to order and review appraisals very soon.

You can help by contacting your local Representative TODAY.
Click here to locate your local Rep.

choicefinance.net contributing writer
Loan Officer for Maryland, Virginia, D.C.
Eric Strasser, 301-996-5001

This entry was posted on Wednesday, July 22nd, 2009 at 5:42 am and is filed under 2) General. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.