An amendment to the Dodd-Frank Wall Street Reform Bill that would eliminate the Home Valuation Code of Conduct (HVCC) survived congressional debates last week, according to one representative’s office.
A congressional conference last week took place to reconcile both versions of the House and Senate financial reform bills. As it stands now, the HVCC would be eliminated 90 days after the bill is signed. A new set of “appraisal independence standards” would replace it, according to the bill.
The Federal Housing Finance Agency (FHFA) implemented HVCC in May 2009 in an attempt to improve the independence of appraisers by prohibiting lenders and third parties from influencing appraisals. It’s a controversial regulation, leading to an increase in demand for appraisal management companies (AMCs) and complaints from independent appraisers who claim they’re being cut out of the market.
But the “appraisal independence standards” will be written and announced 60 days after the bill is passed. The bill, unlike HVCC, allows Fannie Mae or Freddie Mac to accept any appraisal report completed by an appraiser selected or paid by a mortgage loan originator.
The bill also stipulates that the new standards will include a requirement that lenders and their agents pay appraisers at market rates.
Per appraiser Dave Towne: Click above for the full bill as approved by the Congress conference committee on Friday 6/25/2010, now technically known as the “Dodd-Frank Wall Street Reform and Consumer Protection Act.”
Here are the pages Dave suggests you print and read:
- Pg 1 – bill title
- Pg 15 – Subtitle F – Appraisal Activities (TofC for that section)
- Pg 26 – Section 4 Effective Date (FYI…it appears this bill will become effective 1 day after the President’s signature)
- Pages 2205 – 2250 – Subtitle F – Appraisal Activities (This is the section pertaining to appraisers/appraisals, etc.) Have fun reading!