A new bill has recently been proposed entitled H. R. 3044 that will put an 18-month moratorium on Home Valuation Code of Conduct (HVCC). This new bill falls under HERA, or otherwise known as Housing Economic Recovery Act. Within HERA is the HVCC. The HVCC has been the center of discussion in the real estate market since its enactment on May 30, 2009.
Many real estate brokers and mortgage brokers have found issues with the HVCC program. Some of the problems include increased loan rates and loan fees all related to extending rate locks. These rate locks are being broken due to increased turn-around times in appraisals and underwriting. They are finding decreased quality of appraisals. Not to mention many quality appraisers have left the industry all together due to loss of income.
The new bill that has been proposed is calling for an 18-month moratorium on the HVCC program. The moratorium will give Housing and Urban Development (HUD) time to re-evaluate the program and make revisions to it. It will also allow the average consumer time to be able to take advantage of historically low interest rates. However, an 18-month moratorium will not keep appraisers from applying “declining markets adjustments” when they are obviously evident and provable through the Multiple Listing Service. The 18-month moratorium will not keep appraisers from applying the mandated “listing-to-sales-price-ratio” to the three current listings they are now required to use in their reports. Appraisers will still follow the Uniform Standards of Professional Appraisal Practice, also known as USPAP and its guidelines.
How You Can Help Fix HVCC
The moratorium will buy time but will it help fix the declining real estate market? What will happen after the 18-month moratorium? Here is a site that explains HVCC further and has a petition for H.R. 3044. You can also call and/or write your Representative and your Senators and voice your support of H.R. 3044 and your opposition to HVCC.
You can also help by passing this post or the petition along to everyone you know who has a stake in this debate: real estate professionals, buyers, sellers, potential buyers, potential sellers, mortgage professionals?anyone who owns a home basically should be interested in this.