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Living with the HVCC

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The implementation of the Home Valuation Code of Conduct (HVCC) impacts a number of stakeholders in the real estate industry. And as with the implementation of any new program or policy, there is a lot of confusion about what this means to real estate agents and appraisers.

The rumors were rampant. People were concerned that the business relationships that they had spent years building were going away. Appraisal Management Companies (AMCs) were though to be making assignments to appraisers without consideration of their geographic competency. And most important, REALTORS thought that it would be more difficult than ever to contact an appraiser, even to ask them to consider additional data or correct errors in the appraisal report.

To help REALTORS understand the impact, a Regulatory Issues Brief was put together for the 2009 Midyear meetings in Washington D.C. , but many of the REALTORS in the trenches, don’t read those documents, and so the confusion continues. But NAR wasn’t done trying to help us understand the impact of the HVCC.  A page was created on Realtor.org to allow members to view the most up to date information on the HVCC.

But just in case you’re not feeling like checking out www.realtor.org/hvcc, I thought a few of the myths and facts from the site might be useful to you

Myth: The code applies to all mortgages that require an appraisal

Truth: The code only applies to 1-4 family loans sold by Fannie Mae or  Freddie Mac and does not apply to FHA, VA or the Federal Home Loan Banks.

Myth: HVCC Prohibits REALTORS and lenders from talking to appraisers

Truth: REALTORS and lenders can talk to appraisers, including making requests to consider data or correct errors

Myth: Lenders are required to choose appraisers from a rotating rostr approved by Fannie Mae or Freddie Mac

Truth: Lenders may choose to use a rotating roster, but are not required to do so by Fannie Mae or Freddie Mac

Myth: Borrowers must use a credit card upfront to pay for an appraisal

Truth: A borrower is not required to pay for an appraisal with any one particular form of payment.

So in their final analysis, the relationship between REALTORS and appraisers should not be impacted in a negative manner, though we do need to respect the new code, and learn to deal with it.

You do have more options though, including a place to request a reversal of the HVCC – but unless, and until that happens, we need to learn the facts so that we can live with the legislation.

Photo Courtesy of Creative Commons

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19 Comments

19 Comments

  1. Kris Berg

    July 8, 2009 at 11:10 am

    >So in their final analysis, the relationship between REALTORS and appraisers should not be impacted in a negative manner…

    True, and I should not be allowed to continue to attempt to make an edible Beer Brisket, but the problem persists. There is the recipe and then there is the execution.

    This is timely since we missed another appraisal today and were told to pound sand.

  2. Bill Lublin

    July 8, 2009 at 12:05 pm

    Kris:
    I have the same issues and am dealing with an appraisal problem on my Mother-In_Law’s home – impacted by the lender’s misunderstanding of the HVCC – but if we know how it works we can hopefully function a little better.

    Now about that edible Beer Brisket….
    😉

  3. Rod Rebello

    July 8, 2009 at 3:47 pm

    I also suffered from the an appraiser’s misunderstanding. He would not even acknowledge he was assigned to do the appraisal! And I got his contact number from the lender. I sent him a copy of the myths/facts, but he probably won’t open my email :).

  4. Arlington condos Jay

    July 8, 2009 at 9:17 pm

    You should read the very frank input by appraisers impacted by HVCC on my blog post Buyers Get Slapped Around by HVCC Rules and AMCs:

    https://www.justnewlistings.com/arlington-virginia-blog/buyers-get-slapped-around-with-terrible-new-appraisal-rules-and-amcs.html

    As my post ranks #1/2 for “HVCC rules” it has gotten the attention of lots of business owners and appraisers. check it out. The post focuses more in the impact to consumers rather than specific rules….

  5. San Diego Homes

    July 10, 2009 at 3:05 am

    I’m sorry, but this post is it’s own myth. The HVCC rules have changed the appraisal landscape. There are poor appraisers being called to do low-cost appraisals in neighborhoods that they know nothing about. There seems to be serious pressure to undervalue properties, or else the appraisers themselves are just scared that they will somehow overvalue the homes.
    But thanks for your post. I’ll be glad to read more of the ongoing discussion.

  6. Denver Foreclosure Listings

    July 11, 2009 at 2:18 pm

    I agree that there is a lot of misinformation about the HVCC guidelines, but 60 days in, things seem to be getting better.

    There shold definitely be a cap on the fees paid to the Appraisal Management Companies. A 50/50 split between the AMC and appraiser is just not fair. A $25 – $50 fee per appraisal shoud be the VERY top of the limit. The current setup is basically government-mandated extortion.

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Austin

Austin tops the list of best places to buy a home

When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?

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Looking at the bigger picture

(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).

That said, SelfStorage.com dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).

They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.

“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”

Click here to continue reading the list of the 12 best places to buy a home…

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Housing News

Average age of houses on the rise, so is it now better or worse to buy new?

With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.

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The average home age is higher than ever

(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.

With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.

Prices of new homes on the rise

Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.

Click here to continue reading this story…

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Housing News

Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?

The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.

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Why Realtors are vulnerable to these rapid changes

(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.

Note: We’ll let you decide which company plays which role in the image above.

So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.

1. Zillow poaches top talent, Move/NAR sues

It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.

Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.

2. Two major media brands emerge

Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.

…Click here to continue reading this story…

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