I am very much a “roll with the punches” kind of person. Things change, new laws are implemented, new disclosures are required… it’s okay, I get it and I roll with it, explaining the “what” and the “why” without being bothered and understanding the reasoning behind it. So I change what I do accordingly and move on.
But I am NOT treating the Home Valuation Code of Conduct (HVCC) in this regard. I am passionate about fighting this new law because it is irresponsible and costly. These legislators just don’t get it. Let me tell you why:
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Appraisals that used to cost $350 now cost between $430 and $750 (although the upper limit is not set; it depends on how much your home is valued for).
Appraisers that used to take 3-4 days to get us an appraisal (at no extra cost) are now taking between 10 and 20 days, with no guarantee.
What does all this translate to? More money that you have to pay, both in the cost of the appraisal and in the cost of longer lock periods to accommodate how long these appraisal companies are taking. Longer lock period = higher interest rate.
I don’t understand how legislators don’t see that this law is hurting us, as consumers.
They need to find another solution.
Please join me in fighting the HVCC and sign the petition for reconsideration:
www.hvccpetition.com
I have posted many updates and explanations about the HVCC:
Click here to read my initial post about the background of the law
Click here to see the letter I wrote to a number of our governmental representatives
The new HVCC has ruined a twelve year relationship I had with a large mortgage company. I was never pressured to make a value and had a great working relationship with the loan officers and their processors. Now, there is no personal relationships with these Appraisal Management Companies who want you to do twice as much work for half the fee. They can keep it. At a time when this country needs the housing market to turn around this is only making things worse, it needs to be repealed.
Jim, I wholeheartedly agree. The good, hardworking appraisers are not (and should not) take such a significant cut in pay. What’s left are rookie appraisers who are disgruntled for doing so much work for so little pay. Not having that relationship in place makes their work a drudge, and that’s reflected in their work.
Also, my most recent appraisal for San Jose was ordered through an AMC, and the AMC had an appraiser from **MERCED** do the appraisal. Does a Merced appraiser know this area?? No. On top of that is their travel cost, which is part of the total increase in appraisals. How this makes sense to these guys, I don’t know…
I’m happy to see that you, me, and 3 other people “get it”. I’ve been fighting HVCC by writing to every newspaper, congressman, and state board for over 15 months. You are exactly right though. Nobody gets it. CNBC and the Washington Post have a clue but that’s not going to change anything. We’re in the process of closing down our appraisal practice of 17 years. Appraising is a guaranteed loss. You’re odds of winning the lottery or winning in Vegas are far better than turning a profit as an appraiser. Most of the professional appraisers have already figured this out and left residential work to the newbys. Within a year I suspect that they will even figure it out.
I look forward to the day that it dawns on lenders and Congress that they gutted an entire profession that takes 5+ years to train for. I will continue to laugh when they see that they created an even larger credit crisis by implementing HVCC. I will especially take delight in telling Senator Jim Bunning “I told you so”. His office has been supporting both HVCC and their banking friends from the beginning.
Let’s just keep fighting it, David. That’s all we can do right now. I’m constantly sending emails and writing letters too. I’m so sorry to hear you’re going to close your doors. I do hope that something positive comes from all of our letters and emails.
Great news! 86 members of the House Of Representatives now “get it”. The house now has approximately 40% of the support necessary to halt HVCC should it make it’s way from a resolution to a bill. Our office is currently refusing all appraisal orders until Cuomo is forced to eat HVCC for lunch. We now use our webpage http://www.investsmart.com to educate the public on what they were handed in the name of consumer protection. To educate them on the true motives behind the Home Valuation Code Of Conduct.
Not So Great News!
The bill to halt HVCC has passed. Unfortunately the Senate bill will not be voted on until late Spring. By the time the Senate moves it’s sluggish a** along FNMA will no longer exist and HVCC will be a moot point. Seriously! Wall street appears to be in agreement that FNMA and Freddie Mac will be dissolved by Spring of 2010. Once they are dissolved the HVCC agreement will cease to exist.
Aren’t you happy to know that your U.S. Representatives and Senators are hard at work to protect your businesses?
ONE APPRAISERS SOLUTION TO PROFITING FROM HVCC
I will be the first to admit that I was clueless when it came to earning a living as an appraiser after HVCC kicked in last May. For this reason I closed my practice after 17 years.
I ran across an appraiser recently who solved the problem after watching a television program that discussed the Walmart business model. After watching the show he hired 2 newly licensed appraisers to inspect properties at $50 per inspection. He then hired typists in poverty stricken countries for less than $2 per day. Problem solved. He now generates 6-8 orders per day while billing only $150 per appraisal.
I had to ask one question: What about the analysis that’s involved with appraising? His answer was “What Analysis? You are still living in a pre HVCC world…lenders care about two things; fee and turn time. Nothing else matters”.
Judging from his monthly income I can only assume that he is correct.
Good news for appraisers who were able to hang in there. It looks like Congress will pass a bill that sunsets HVCC this Fall. The bad news is that it should sunset roughly 1 month after it was set to expire.
HVCC managed to do two things:
1. Create new profit centers for banks that will live on well after HVCC is deceased.
2. It gutted the appraisal profession of nearly all experienced professionals. Newly licensed appraisers should thrive in the new form filling atmosphere as 2011 approaches however.
3. It has assured homeowners that receive the lowest quality appraisal reports for decades to come.