The National Association of Realtors needs Realtor® and consumer assistance.  We are asked to contact our members of Congress to co-sponsor HR 3044, a bill that would impose an 18 month moratorium on the code.  We need to temporarily stop the mandatory use of the appraisal management companies.

            As the housing market may be on a slow recovery, the new Home Valuation Code of Conduct (HVCC) is causing havoc in the market place by placing undue financial cost on the home purchaser and other issues with the appraisers.

            As we all know, appraisers are taking a beating over the housing markets past increased values.  Due to new regulations, in most cases for an appraiser to be assigned to a job for a Fannie Mae or Freddie Mac loan, they must belong to an appraisal management company (AMC).  The AMC has overhead to pay.  Appraisals that used to cost $250-$350 are now costing $375-$550 per assignment, meanwhile the appraiser is taking a pay cut to work for an AMC that the government has so kindly instructed the Fannie Mae and Freddie Mac lender to use.  Currently, it's not a good scenario. 

            Appraisers are supposed to stay in familiar known areas.  The AMC apparently sends assignments to the appraisers that will take the least amount of pay.  The chosen appraisers are sent any where and everywhere.  These appraisers aren't always familiar with the areas, causing bad comps and once again, bad values.  Only this time the bad values are swinging the other way, too low.  Not all appraisals are low, just enough to make everything difficult and weary.  Purchasers are paying in advance for the appraisals then the low value causes the transaction not to close.  The purchasers do not get a refund.  This practice also violates the appraisers USPAP Code of Ethics. 

            The goal at the beginning was to create a wall between the lender and the appraiser.  The government thought the lender / appraiser contact was one of the roots of the housing value problem.  While separating the 2 maybe a good idea, there has to be a full plan for success.  There currently is no plan.

            We understand that for the Chase Banks, Wells Fargo's and Bank of America's the use of an AMC is needed because of loan volume, let's take a step back to make a productive plan for all.  If the current issues excel, the volume won't be a worry.

 In the recent issue of REALTOR, September 2009, the National Association of Realtors® explained the issue completely.  They have asked that we help.  To see a list of sponsors please visit www.govtrack.com.

Angie Ridley
www.CompleteRealtyLLC.com
www.AngieRidley.com