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HVCC -Payment before inspecting the property?

Discussion in 'Fannie Mae, Freddie Mac, USPAP' started by teachme, Jan 22, 2009.

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  1. teachme

    teachme New Member

    0
    Nov 16, 2008
    Professional Status:
    IT Professional-Appraisal Related
    State:
    California
    Is the HVCC saying the appraisal has to be paid at the time of ordering the appraisal? If so, please show me where...
     
  2. D-Max

    D-Max Junior Member

    0
    Apr 26, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    North Carolina
    The way I read it the HVCC eliminates COD (paid by the borrower) orders. It states that the lender or the lender's agent is responsible for appraiser compensation. It does not specify when the appraiser is to be paid that I have seen.
     
  3. Mike Kennedy

    Mike Kennedy Elite Member

    28
    Sep 28, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    New York
  4. ghrousseau

    ghrousseau Member

    0
    May 5, 2006
    Professional Status:
    Licensed Appraiser
    State:
    Virginia
    I don't think it will prohibit the appraiser from collecting a check COD at the door paid directly to the "lender." It states that the "broker" can not pay directly the appraiser with a check. This is currently one of the processes that brokers typically do..........................collect a check upfront from the borrower for appraisal and credit report...................then they pay the appraiser from their broker account. Also, there are some loans where the appraiser is paid through the closing on the HUD-1 by the borrower.

    What is going to be even more interesting is when the broker is helping pay the borrower's closings costs on a purchase or refinance. On the HUD-1 the appraisal fee will be showing due to the appraiser, but the broker will credit a portion of their origination or YSP to pay the appraisal on behalf of the borrower. Technically, this would be a violation as the appraiser is being paid by the Broker.....................one more unintended consequence the brilliant minds that devised the HVCC didn't think about.

    Regardless, the appraiser not being able to collect an appraisal fee check directly paid and written out to the appraiser will be a nightmare cf for the lender. They are going to have to get the borrower to pay up front on every loan or risk eating the appraisal fee. Currently, some lenders have 20 to 40% fallout on loans.
     
    Last edited: Jan 23, 2009
  5. D-Max

    D-Max Junior Member

    0
    Apr 26, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    North Carolina
    I don't read it that way. I don't remember the thread but this was discussed in one of the HVCC threads sometime near the first of the year. One of the problems with this "agreement" is that there are areas that are open to much interpretation.
     
  6. Jim Onderisin

    Jim Onderisin Senior Member

    4
    Sep 15, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    Illinois
    As I read the revised HVCC, the appraiser will be paid directly by the lender who ordered the appraisal. Borrowers are no longer going to pay COD direct to the appraiser. The intention is for the lender to take responsibility for the appraisal. The lender orders and pays for it.

    ghrousseou: My understanding is that, after the HVCC kicks in, brokers will no longer even be part of the equation when it comes to ordering or paying for an appraisal (unless the appraisal does not fall under the HVCC...like FHA or VA).
     
  7. Mike Kennedy

    Mike Kennedy Elite Member

    28
    Sep 28, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    New York
    HVCC 2009 Q&A

    Q13. Does the Code prohibit an appraiser from collecting payment for the appraisal directly from the borrower?
    [FONT=Arial,Arial][FONT=Arial,Arial]Yes, for loans to be delivered to Fannie Mae. The Code requires the lender or any third party specifically authorized by the lender to select, retain, and provide for all compensation to the appraiser. [/FONT][/FONT]
    ****************************************************************************************
    also for further clarification and dissemination to LENDERS >> (not so subtle hint )

    Q25. Is a lender required to use an appraisal management company for ordering appraisals?

    [FONT=Arial,Arial][FONT=Arial,Arial]No. [/FONT][/FONT]
    [FONT=Arial,Arial][FONT=Arial,Arial][/FONT][/FONT]
    [FONT=Arial,Arial][FONT=Arial,Arial]A lender may order appraisals directly from an individual appraiser. [/FONT]

    [/FONT]
     
    Last edited: Jun 23, 2009
  8. Sandra Koutsopoulos

    Sandra Koutsopoulos Junior Member

    1
    Jul 13, 2005
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    Hold your breath, the check is in the mail

    Considering these fly-by-night AMCs' dreadful penchant for not paying for an appraisal until it is 90 days old (regardless that their websites say 'payment within 7 days'), or until the AMC goes out of business first, why would an appraiser agree to do work for AMCs, get paid 1/4 to 1/3 of their fee, and then perhaps never get paid at all after playing bill-collector for months?! I've rarely done work for AMCs, but have had this happen. I prefer to get paid at the door by the Borrower, or at least within 7 days from the Lender if they are a good credit risk. Those are my rules, otherwise I won't play the game.

    This is all exasperating. Not only are we asked to do more work, add another form (1004MC), turn the appraisal report in within a day or two, get paid a pittance, wait for months or forever for our stingy little payment, and be abused by phone monkies to boot! This is not the type of treatment a 'professional appraiser' should accept. Try that with your CPA, your doctor, the hospital nurse, or the airline pilot! No, they are respected for the work they do, require payment, and are expected to do a good job.

    It is unfortunate that so many appraisers are rolling over, accepting these measly handouts as a starving beggar hungrily snatches a dry crust of bread. Just as a crust of bread is not adequate for good health, AMCs are equally dangerous to the existence and life of appraisers. A bit of cash flow is not profit, just slows the starvation and numbs the mind.
     
  9. Wendy

    Wendy Senior Member

    0
    Feb 23, 2004
    Professional Status:
    Certified Residential Appraiser
    State:
    Florida
    Well said Sandra!!! :clapping:
     
  10. Bigrock

    Bigrock Member

    0
    Jun 6, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    Georgia
    I wonder if the regulator of Fannie Mae is going to be the payer of last resort for those lenders who go out of business before paying the appraiser...

    I remember when Homebanc went under,,some local sweat shops took it in the shorts for 50-60K in fees....


    I am all COD as of now, so who am I supposed to extend credit to?

    Seems like a con game to me...
     
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