Shane Leady of Apella Real Estate Business Solutions, and author of the popular appraisal blog Table Talk With Apella, has completed his review of the Cuomo Home Valuation Code of Conduct.
His "Under The Hood" look at the HVCC is unique in that he's analyzed both the pros and cons . . .and offered his conclusions on a section by section basis!
With Shane's permission, I've uploaded his complete analysis in RTF and PDF versions to the Appraisal Scoop's servers. I've also included selected segments of his Table Talk With Apella blog post below.
From "Appella's Review of Cuomo - GSE Home Valuation Code of Conduct:
As of late February New York Attorney General Andrew M. Cuomo and Fannie Mae, Freddie Mac established an agreement that has been titled The Home Valuation Code of Conduct.
The Home Valuation Code of Conduct is compiled of eleven sections. The HVCC holds much potential in effecting the appraisal industry and the parties that use appraisal services for loans that are sold to the government-sponsored enterprises. The Home Valuation Code of Conduct was welcomed and endorsed or commended by all major appraisal groups including the Appraisal Institute and American Society of Appraisers (ASA noted changes needed).
Apella has researched various key components of the HVCC and compiled his analysis with attention to both its strengths and shortcomings. Apella cautions: "Readers will need to refer to the Home Valuation Code of Conduct for actual and complete section reading.
The intention of Appella's analysis . . "is to allow the reader to compile their own independent view based on truthful as possible information and non-subjective links, facts and history."
Here are a few excerpts from "Apella's Review of Cuomo - GSE Home Valuation Code of Conduct:
Apella’s View – Support For Section I and Sub-Section 5
In regards to Fannie Mae and Freddie Mac, 24 million is not enough and portions of the funds should go to each state appraisal board of enforcement were complaints can be made to the federal entities that governor such infractions. The complaint line should be engaged with direct reporting to the governmental entities that can inflict enough economical damage/time served to ensure infractions are not committed.
Apella’s View – Support For Section II With Major Modifications
It is clear that the Home Valuation Code of Conduct fails to stress the amount of borrowers that never see the light of the appraisal done on their property or property of interest. Appraisers are very limited when they receive calls from the borrower’s looking to get a copy of the appraisal. As appraisers or appraisal management companies, the responsibility is only to ensure that the client or party that ordered the appraisal received the appraisal. The appraiser’s agency belongs to the client that placed the order for the appraisal and as such appraisers are not allowed to release a copy of the appraisal to any other party unless a signed release is received by the appraiser or appraisal management company, ether instructing or requesting the appraisal be released to the borrower or other party deemed by the client.
Apella’s View – No Support For Section III
This section infringes too much on free trade and hampers quality as well as the consumer. It is viewed that the cost increases that will be required for the consumer to operate under this section will in the end make the appraisal industry uneconomical and prohibitive for mortgage companies, mid size banks and the consumer making the loan request.
For ALL of the analyses download the COMPLETE document:
APELLA SAYS: Thanks must go out to persons and blogs that have assisted in the compiling of the following. Table Talk With Apella extends gratitude to the Appraisal Scoop Blog and Jillayne Schlicke of Ethical Lending Foundation and Rain City Blog as well as Jose Rodriguez of Athena National Residential Service Group for their input and questions raised to the issue at hand.
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