congress gets down to BUSINESS on H.R. 3126!

Mortgage and Lending NMLS #94045

This week, the House Financial Services Committee passed H.R. 3126, the "Consumer Financial Protection Agency Act of 2009" including an amendment to repeal HVCC, the Home Valuation Code of Conduct, or as we call it, the "Havoc Rule". The bill still has to clear both houses and be ratified into law. Any chance of that before Christmas to save the sale market running up to the new year?

This bill also contains the First Time Buyer Tax Credit extension and provisions to assist repeat home buyers and small businesses with tax breaks. All great ideas. But as measures, resolutions and bills go, it will be very crucial what of any substance survives. We have a Congress and an Administration that seems intent on self regulation by the biggest offenders while penalizing the solo entrepreneurs.  

Thanks to all the realtors, mortgage brokers, appraisers, investors and home buyers for supporting this legislation. Read the recent NAMB release on how this affects our national housing industry.  

Will FHA fall prey to HVCC? We are particularly concerned that FHA is supposed to adopt HVCC in January 2010. Currently, FHA certified appraisers may be hired directly. Since the adoption of the HVCC, we have witnessed delays while extra paperwork and reviews fly back and forth via a third party mechanism; the loss of fees to middlemen of Appraisal Management Companies, and appraisers from outside our area delivering low-ball valuations. Many senior appraisers are retiring rather than contend with the impacts to their businesses. Who is being served? AMC's and the banks that own them! 

I know this sounds like sour grapes. But the effects speak for themselves:

"In a recent Internet poll, real estate industry professionals were asked to indicate the value that was generated by their last HVCC appraisal relative to the sales contract price that the seller and buyer had agreed upon. With 57.7% of the sales values being lowered by more than 3% the results below highlight how dramatically HVCC is artificially deflating the value and equity of every home in America."  

This rule has forced brokers and mortgage banks like ourselves to hire AMC's in order to define an appraiser group. So now, appraisers must sign up with multiple AMC's to cover a multitude of lender preferences (i.e., their own particular criteria)-- which means higher costs to them and fee cuts, while raising the cost to consumers. Brutal!  

Mortgage professionals, appraisers and realtors and our local politicians support a vibrant real estate recovery and rely on fair and professional valuations to help achieve this. Please call, email or write your Congress Persons and ask them to support this legislation.  

And hey--be careful out there!

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NMLS# 94045



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  1. David Zablatsky 11/26/2009 03:39 PM
ActiveRain Community
Posts to Localism
The FHA Mortgage Group
first time homebuyer tax credit
house financial services committee
hvcc reform
hr 3126

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David Zablatsky
Avant Realty Group - Needham, MA
Real Estate - Needham, MA



Thank you for your posting, much appreciated!


Oct 29, 2009 04:41 PM #1
Susan Templeton
Bellingham, WA

Thanks, David. Please pass this on to your colleagues to put pressure on your congressional representatives. They need to be buried in emails, calls and letters!

Oct 29, 2009 05:10 PM #2
Jay-Paul Lowry
Riverside, CA

Loannetter - you said you were a mortgage banker, so why use AMC's? HVCC allows for lenders to not use them. We are a lender and we dont/wont use them. I agree with you though it is bad piece of legislation.



Nov 02, 2009 10:47 AM #3
Susan Templeton
Bellingham, WA

Hi JP, Guess I should clarify we also broker so the requirement is there for conventional banks we wholesale to. Today's Mortgage news reported that Appraisal fraud is now up 46% this year...wonder why? Not from Broker influence obviously!

Nov 02, 2009 11:25 AM #4
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