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Industry News
The Homeowners Valuation Code of Conduct will be sunsetted following the recent signing of the new Dodd Frank Wall Street Reform and Consumer Protection Act by President Obama.
Provisions of the new law impact real estate appraisers directly - and in good ways. The principal impacts are seen in Title XIV Subtitle F on Appraisal Activities. See the text of Subtitle F in what is otherwise known as the Finance Law.
Here is a summary of the major provisions. Bottom line - higher fees and more appraisals with less pressure.
- Residential conforming sub-prime loans will require a
written appraisal. For these loans:
- The written appraisal must be performed by a certified or licensed appraiser who visits the interior of the property;
- If the property is being resold within 180 days at a higher price, a second appraisal is required at no charge to the applicant;
- Consumers to be given a notice that a separate appraisal may be conducted at their expense;
- Appraisal independence will be strengthened to prevent any undue influence on the appraiser's valuation;
- Appraisal fees must be customary and reasonable; Fee studies shall exclude fees paid by known appraisal management companies;
- More may be paid for complex assignments;
- HVCC will sunset within 90 days of July 21, 2010. ie by October 19, 2010 at the latest to be replaced by interim final regulations;
- AMCs will be regulated;
- Broker Price Opinions are prohibited as valuations for the purchase of principal dwellings;
- Consumers may be required to pay only a reasonable fee for an appraisal - squeezing AMCs' fee structure;
- Closing statements will breakout the fee paid to the appraiser and that to the AMC;