Starting tomorrow the new rulings dubbed the HVCC – Home Valuation Code of Conduct come into play.
However with many confusing rumors and negativity floating about on the web about how the new rules will effect the real estate and mortgage process at the moment will be changing it is time to set the record straight!
The HVCC is designed to help protect consumers from any relationship between a lender or mortgage broker and a specific appraiser. It does not forbid independent appraisers to be used, but just limits how they may possibly be influenced by the mortgage broker or lender. This means, in theory, that the consumer can be assured that the appraiser is acting in the best interests of the consumer in returning a fair market value for a property.
To avoid the HVCC becoming meaningless there are several safeguards in place, for instance Freddie Mac (FHLMC) will not purchase any loans from sellers who do not adopt the code. The news on how Fannie Mae will handle the HVCC has not been announced yet. To ensure that the code is enforced and the quality of appraisals is upheld there is to be the formation of a regulatory body named the Independent Valuation Protection Institute (IVPI).
It has been said by some that the rulings will mean higher costs for the consumer as well as leaving many brokers unprepared. What is sure is the the next few months as the rules start to really take effect will be interesting.
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If you are interested in purchasing a property or selling a property in Malibu, Pacific Palisades or the surrounding Beverly Hills/southern California area then please contact Judy Kunisaki for professional real estate advice in the Westside Los Angeles area, on 310-317-8396 or via her online contact form on her website.
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