HVCC-Seems ok, tell me why I'm wrong

[Joe23]

The revised HVCC appears, to me, would not force mortgage brokers to use AMC's at all. It just appears to me that you have to hire or make your secretary an "office manager", send them to an appraisal class, and just make sure that they are on a salary and in no way, including bonuses, connected to commissions from actual loans. See section III paragraph C below.

Larger companies would just have a larger appraisal ordering/reviewing department. Several large companies that use our company already have this in place, and are giving us the same fee as before!

C. Any employee of the lender (or if the lender retains an appraisal company or appraisal management
company, any employee of that company) tasked with selecting appraisers for an approved panel or
substantive appraisal review must be (1) appropriately trained and qualified in the area of real estate
appraisals, and (2) in the case of an employee of the lender, wholly independent of the loan production
staff and process.

Do any of you see this differently?​

 

[ghrousseau]

The revised HVCC appears, to me, would not force mortgage brokers to use AMC's at all. It just appears to me that you have to hire or make your secretary an "office manager", send them to an appraisal class, and just make sure that they are on a salary and in no way, including bonuses, connected to commissions from actual loans. See section III paragraph C below.

Larger companies would just have a larger appraisal ordering/reviewing department. Several large companies that use our company already have this in place, and are giving us the same fee as before!

C. Any employee of the lender (or if the lender retains an appraisal company or appraisal management
company, any employee of that company) tasked with selecting appraisers for an approved panel or
substantive appraisal review must be (1) appropriately trained and qualified in the area of real estate
appraisals, and (2) in the case of an employee of the lender, wholly independent of the loan production
staff and process.

Do any of you see this differently?​

Unfortunately things do not work that way Joe. Brokers are subject to the requirements of the lenders that they submit loans to. Currently most wholesale lenders like Chase, BB&T, Wells Fargo, Flagstar, Taylor Bean Whittaker, ect. require the broker submitting a loan file to use their preferred AMC vendor in order to submit the loan. They really do not have much choice in the matter. The HVCC provided additional justification for a practice that many wholesale lenders have been adopting for several years now.

Welcome to the forum by the way.

 

[Mike Kennedy]

Joe, unless employed by a Correspondent Lender/Mortgage Company, independent Mortgage Brokers are commissioned agents for the lenders they broker the originated loan applications to. They are NOT Lenders. Those independent mbs who wish to continue in loan origination have several options, develop a Lender clientele of Portfolio lenders who do not sell loans to the GSES, get employed by Correspondent Lenders, get employed on Staff by Banks/Financial Institutions, or seek $$ greener pastures. Note: many of the so-called "AMCs" which started up in the past 2 years are former MBS. Be careful out there.

 

[Joe23]

I think I see the distiction there. Does this mean that mortgage brokers will be a thing of the past?

 

[George Hatch]

No, mortgage brokers will soldier on. They just won't be involved in obtaining appraisals that will be used in loan packages going to Fannie/Freddie.

 

[Highlander416]

I do work for several Correspondent Lenders. I am still unclear how they will fall under HVCC. Will having a person in the office dedicated to ordering appraisals be acceptable, or do they also need to go the AMC route?

 

[George Hatch]

As long as that person doesn't answer to anyone on the loan production side of the business that model should work just fine.

 

[ghrousseau]

I do work for several Correspondent Lenders. I am still unclear how they will fall under HVCC. Will having a person in the office dedicated to ordering appraisals be acceptable, or do they also need to go the AMC route?

I work for one Highlander, and it is still up in the air. We are approved to sell with Fannie directly, yet we still also sell loans to BB&T, CW, Chase, Wells, M&T, and US Bank, ect. We also originate a large amount of VA and FHA loans which do not come under the HVCC. So far none of our investors are requiring us to use a particular AMC. The main distinction between a Broker and a Correspondent is that we sell an entire closed loan package in our name with our guarantees to the investor. They have recourse for the entire loan against us if there is a problem. Wholesale brokers submit the loan file and it closes in the investors name, so they currently call the shots which is why those investors I mentioned above require AMC's on all of their broker submitted wholesale loans. The fact that most correspondents are approved to sell directly to Fannie or Freddie complicates matters. We can be in complete compliance internally with the HVCC per a Fannie Mae audit, yet a particular investor may still require the use of an AMC. We shall see. My guess is they will not, because there will be an incentive for another investor to not require an AMC, and therefore get more business from the correspondent lenders. My guess is that if they were going to require correspondents to use AMC's they would have by now. Also, the investors I mentioned above would not make any cut of the AMC portion of the fee. Correspondents would be able to negotiate their own rate they pay to the AMC so there would be no benefit to a CW, Chase, or BB&T. It will be interesting to see what kind of games they play. If they don't like a loan down the road are the going to "audit" it to see if it was HVCC compliant??

 

[RitaB]

Some brokers see this as the end for them. Some probably don't know how to make a deal work without subtle and non-subtle pressure to make value. Some feel that they won't be able to shop the loan to different lenders because of this. We shall see. Loan officers are experts at the work-around.

 

[Leon Marcus]

All brokers using wholsale lenders are being forced into using only certaine AMC's and are given a deadline. They are given the "option" to use any they want but if they are not the "aprpoved" MAC they will have to pay $300-$400 for a review befire the report will be accepted.
None of my clients are able to use me in any way they can not afford to pay my fee along with another $300-$400 just to see it it passes the AMC review. If anyone hears any other way around this let us all know. All my clients are being forced to change in the next two months. They dont want to but they have to.