HVCC-HOW TO DELAY YOUR LOAN IN 1 EASY LESSON

What does HVCC stand for, and what it is? Well, it stands for Home Valuation Code of Conduct. And it's Fannie Mae & Freddie Mac's (this does not appy to FHA) attempt at sending appraisers to their rooms for being bad. The assumption is that because lenders/brokers and appraisers had an actual working relationship, that appraisers would risk their licenses and give that lender the value needed to do a loan for a client. Did that happen? Of course it did. There's bad appraisers, just like there's bad lenders,bad post men and so on. But appraisals are an opinion of a range of value, most generally given by a licensed,qualified appraiser. The guy walking around your house with a little wheel on a stick isn't Bernie Madoff. And he probably didn't cause the real estate bubble to burst. But he is a convenient scape goat. Until HVCC became a reality, you most often had an appraisal ordered by either your lender or mortgage broker. And yes, there was this terrible thing called a rapport established. How dare two professionals try to work together to get your appraisal done. In my years, that rapport didn't lead to the 3 walled hovel down the street getting appraised at $400,000. It led to things like an appraiser meeting a client after normal hours,looking at comparable sales to establish a general value before the appraiser took your check for $350, and things of that nature.
But now in the infinite wisdom of those with the least amount of it, when you order an appraisal, it is given to an appraisal management company. The theory is that by using an intermediary, those bad ole' appraisers won't be able to get away with their shenanigans anymore. 'See the management company will then contact an appraisers on their "list". The appraiser may be from the local area...maybe not. And almost assuredly, the management company's knowledge of that appraiser is the resume he turned in, and a license search. The management company will then charge you between $400-$500 in ADVANCE...on your credit card. Because obviously, an appraiser couldn't be trusted with collecting a check at the door. Now here's where it gets very interesting.
Remember in the good old days an appraisal cost around $350? Well now, for the right to baby sit appraisers, the management companies charge you more. And the appraiser(who, by the way, is generally self-employed) may get $200-$250 of that fee, for doing exactly what he used to get $350 to do. Hmmmmm. Guess what quality of work and responsiveness you may see? And it gets better. Because lenders don't all use the same management companies....here it comes......they probably won't accept the same appraisal. Which means, if you decide you want to go to a different lender, you have to pay all over again. In the words of Homer Simpson....DOHHHHH!!!
The one silver lining in all of this. A bill, H.R. 3044, granting an 18 month moratorium on the wonderful world of HVCC has just been introduced... Click Here to read an article on it. Hopefully it will get appraisers out of their Time Out Chairs and back to doing appraisals like they should.