Alright, here’s your chance to talk about the effects HVCC is having on you and your clients.  Technically, HVCC is not a federal law but the result of a joint agreement between Fannie Mae, Freddie Mac, the Federal Housing Finance Agency, and the New York State Attorney General. More on HVCC basics here.  Yet this has been implemented nationwide. 

The idea behind HVCC was to help ensure appraiser independence and to protect the integrity of the appraisal valuation process. HVCC was a settlement. Instead of the NY Attorney General suing Fannie Mae, Freddie Mac, WaMu and First American’s e-Appraise-it appraisal management company, we ended up with HVCC. 

From the New York Attorney General’s press release:

“For more than a year, the Attorney General’s office has conducted an industry-wide investigation into mortgage fraud. On November 7, 2007, Cuomo announced he had issued Martin Act subpoenas to Fannie Mae and Freddie Mac seeking information on the mortgage loans the companies purchased from banks, including Washington Mutual, the nation’s largest savings and loan. The subpoenas also sought information on the due diligence practices of Fannie Mae and Freddie Mac, and their valuations of appraisals.

The subpoenas came on the heels of the filing of a lawsuit by the Attorney General against First American and its subsidiary eAppraiseIt. The lawsuit, announced on November 1, 2007, detailed a scheme in numerous e-mails showing First American and eAppraiseIT caved to pressure from Washington Mutual to use appraisers who provided inflated appraisals on homes. E-mails also show that executives at First American and eAppraiseIT knew their behavior was illegal, but intentionally broke the law to secure future business with Washington Mutual. Between April 2006 and October 2007, eAppraiseIT provided over 250,000 appraisals for Washington Mutual.  The lawsuit is still pending, and the industry-wide investigation into mortgage fraud continues.”

Here’s the NAMB resource page for HVCC.

Here is the bill that’s been introduced that would put a temporary moratorium on HVCC.

Tell us about your experiences living through the transition to HVCC, and how things are going presently.  For example, has HVCC harmed you or your clients or prevented you from conducting business?