New Home Valuation Code of Conduct

Effective May 1, a new law was put into place nationwide in the mortgage industry called the Home Value Code of Conduct. (HVCC). Whether we like it or not, from this point forward, loan originators are not allowed to have any communication with appraisers regarding the value of a property. This includes “comp checks”, purchase transactions and refinances.

All Banks, Mortgage Brokers and Mortgage Bankers are subject to this new law. When looking at properties, it will become more important than ever to properly assess the value of a property before making an offer so you don’t run into an appraisal issues. To read more about these changes, check out the details at Investment Mortgage Guy.com

3 comments

#1mls mnMay 5, 2009, 7:54 pm

Though this will slow down the approval process, I do think this is a very good idea. Thanks for the info.

#2MN MLSMay 5, 2009, 8:24 pm

HVCC – what a joke. Yes, the new code is in affect, but as of now there is no way to enforce it. They shall create an Independent Valuation Protection Institute which includes a “telephone hotline” to receive any complaints. Give me a break! No one even knows what the # is.

#3RealEstateJoeMay 6, 2009, 4:26 pm

This is similar to the “Chinese Wall” situation setting investment bankers apart from security broker/dealers. They could have desks next to each other but cannot communicate information. It sort of works, but I am not sure as to the intent of the regulation. Lenders have to be able to valuate properties in order to determine if the assets are sound.

Add your comment

Nickname:

E-mail:

Website:

Comment:

Anti-Spam:

What is the sum of four + nine ?

Other articlesgo to homepage

	What is the importance of PMI in real estate business?(0) Real estate business is a highly specialized field that has its own set of terminologies. People who are not interested in purchasing or selling properties may not be aware of the terminology. One such term is private mortgage insurance (PMI). This insurance provides protection to the lender against non-payment in case the borrower [...]

	Deposit Bridging No Money Down Investment(0) Jakob Austin from the UK writes our guest post today about different types of financing. This is very similar to our Rehab Financing that we use. If deposits aren’t available as ready cash it is advisable to be able to borrow it. Bridging is of two types open bridging and closed bridging. In open bridging, lenders [...]

	Wells Fargo Pulling Out of Investment Property Loans (somewhat)(3) Wells Fargo announced last week that they decided to take the conservative approach with some of it correspondent channels and will no longer be purchasing some non-owner occupied loans in the secondary market. All retail departments and some correspondent channels will remain unchanged. Rob Bonahoom, with Cornerstone Mortgage, reports that this change may be a [...]

	Why You Can’t Get Your Mortgage News From a Newspaper(0) OK. I admit it. I like to get a chuckle at the expense of others. Usually it is out of the stupidity of others. Just look at my list of Stupid Property Repairs! I am sure there is someone out there making fun of me, so I guess I reap what I sow. I was reading [...]

	Fannie Mae Now Offers Refinancing on Investment Property to 105% LTV(2) Rob Bonahoom wrote a great article about how Fannie Mae continues to loosen up its regulations to allow investors to help fix this mortgage crisis. They will now allow you to refinance your investment property out to 105% LTV. Read all the details at: Investment Mortgage Guy.com