The fight against the HVCC isn’t over yet! I would like to share with you the letter that I wrote and sent to 9 of our elected representatives (governor, congresspeople and president). If you would like to contribute your own letter or phone call (or even use mine), please let me know if you need any help locating addresses or phone numbers. The least we can all do is try.
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May 4, 2009
Dear Senator:
Subject: Home Valuation Code of Conduct (HVCC)
I am devastated by the Home Valuation Code of Conduct, not because of the effect it will have on my business as a mortgage professional, but because of the significant negative effects it already has on consumers. The HVCC translates to higher appraisal costs and longer turn-times, which results in higher consumer-paid fees as well as higher interest rates. AMCs have no accountability in completing appraisals in a timely manner, and this means that consumers must pay for higher interest rates through longer lock periods. In addition, my clients have always paid $350.00 for an appraisal; AMCs do not guarantee the new cost of their appraisals, except to say that it is value-based, and the “cheapest” appraisal cost is $440.00. Consumers are hurt financially by the HVCC, in a time when they need to be protected financially.
Since this law went into effect on May 1st (please note the date my letter is written), an AMC is taking 2 business days to change one insignificant word on the appraisal, per the underwriter’s condition. These two business days will delay the closing, which is already translating to an additional cost for extending the lock, which the borrower must pay.
Although the intention of the HVCC is amenable, it is irresponsible and irrevocably misguided. The HVCC only serves to fatten the pockets of the AMCs. Please find an alternative solution. I will not state in this letter the effect this new law has on ethical and responsible independent appraisers.
I urge you to help us, as consumers, fight the HVCC. Please do not hesitate to contact me with any questions.
Sincerely,
Irene Moustakas
GRANITE FINANCIAL
CA DRE License # 01419531
Great letter, Irene. I will copy and paste it and make a few changes and mail it off this coming Tuesday. I will repost on FB, too! Craziness!
Take Care, Chrystal
Thanks Chrystal! A couple other things about the HVCC:
1. Some lenders require people to pay for the appraisal upfront with their own credit card (as opposed to the way I like to do it, where I pay for the appraisal for my client, and then charge the borrower through the close of escrow).
2. Appraisals will not be transferable from one lender to another. This means that if rates go down while in the loan process, we would have to order a brand new appraisal and incur that new cost as well.
I get what this law is trying to accomplish (for appraisers and lenders not to inflate home prices), but it really is hurting us all…