Interesting answer in the FNMA Q&A

[Dan/Fla]

Q13. Does the Code prohibit an appraiser from collecting payment for the appraisal directly from the borrower?
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.

My question is Fannie Mea & or the HVCC going to restrict a company who does not pay the apptaiser lets say due to the loan not going through?

Q18. When selecting an appraiser, may lenders use a pre-approved appraiser list or panel?

Yes. Lenders may use a pre-approved list or panel to select a residential appraiser, provided that (1) any employees of the lender tasked with selecting appraisers for the list are independent of the loan production staff; and (2) the loan production staff is not involved in selecting appraisers off the list for particular appraisal assignments.


Q32. May a lender accept an appraisal prepared by an appraiser that was ordered by a mortgage broker?
No. The Code does not allow a lender to accept an appraisal prepared by an appraiser that was ordered by a mortgage broker as noted in Section IIIA. of the Code

Many brokers use processors who order the appraisal which do not get there income from the loan itself.. I believe we need to learn as much as possible to teach our better client's how to service in the HVCC environment.

Ok something I just thought of while writing this. Maybe a little of the wall; what if a enterprising person and or appraiser contacted all brokers just in the surrounding counties and set up a rotating list of least say all appraisers in this local area. Charge like a $25 fee, just to forward the assignment, would that not make all local brokers compliant? The appraiser will deliver the report back to the lender directly.

This part may **** some off. Example: Lets use my area I cover 3 counties, contact only brokers for those 3 counties. But only have Certified or License appraisers who license address is in those 3 counties, and or maybe 1 county that adjoins one of those counties. Out state brokers will have to go some other way as will farther away appraisers, Do not want it to get too big.

 

[GCJim]

.......While I don't think taking a stand is a bad idea (I do it by simply refusing to work for AMCs, now and forever), taking a stand isn't going to correct the problem. The workload simply isn't there.

I think this is a bit myopic. I think it's also fairly typical of those appraisers out there that are doing relatively 'OK', if not 'Great'. It is ALSO fairly typical of some CG's who could care less about residential work.

I don't work for AMC's either, but I would hate to see the residential side go to these dogs. Whatever residential workload there is, guess where it is? Taking a stand CAN correct the problem, especially when coming from the most experienced and educated among us. I would hope that all appraisers would think more of the appraisal industry overall, as a whole, rather than CG vs CR, commercial vs residential, niche appraisers vs appraisers primarily involved in the residential lending side, etc.

 

[ghrousseau]

Q13. Does the Code prohibit an appraiser from collecting payment for the appraisal directly from the borrower?
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.

My question is Fannie Mea & or the HVCC going to restrict a company who does not pay the apptaiser lets say due to the loan not going through?

Then technically by not paying the appraiser they would be violating the HVCC.

Section IB(2) withholding or threatening to withhold timely payment or partial payment for and appraisal report


Many brokers use processors who order the appraisal which do not get there income from the loan itself.. I believe we need to learn as much as possible to teach our better client's how to service in the HVCC environment.

This portion would be irrelevant if the broker's wholesale lender does not allow. Also, technically, the broker's company can still not pay for the appraisal report and the appraiser can not collect from the borrower. Are you going to take that assignment if the broker and the borrower can't pay you?

Ok something I just thought of while writing this. Maybe a little of the wall; what if a enterprising person and or appraiser contacted all brokers just in the surrounding counties and set up a rotating list of least say all appraisers in this local area. Charge like a $25 fee, just to forward the assignment, would that not make all local brokers compliant? The appraiser will deliver the report back to the lender directly.

Lenders are still responsible to engaging the appraiser directly in order to be HVCC compliant.

This part may **** some off. Example: Lets use my area I cover 3 counties, contact only brokers for those 3 counties. But only have Certified or License appraisers who license address is in those 3 counties, and or maybe 1 county that adjoins one of those counties. Out state brokers will have to go some other way as will farther away appraisers, Do not want it to get too big.

I think you might be referring to question Q2. This only states that the "appraiser" has to be licensed in the state in which the property to be appraised is located. I think the original intent of this was regarding out of state review appraisers. I'm not certain if they will address this, but I doubt it as Fannie and Freddie use staff appraisers to review reports on a national basis.


I'm pretty convinced at this point that the NAMB will file a lawsuit along with several other organizations. Brokers not being able to even order a report through a third party AMC................or a national appraisal co-op by the way will surely put many hardworking appraisers out of the business completely.

 

[Bigrock]

Apparently Flag Star did not get the memo about Brokers ordering directly from their Pupet AMC's....


This is from Flagstar.



WE'RE COMMITTED TO YOU
Educating you on new and changing rules and regulations
New Federal appraisal rules and regulations
The Home Valuation Code of Conduct
In December 2008 the Federal Housing Finance Agency approved an updated version of the Home Valuation Code of Conduct (Code) to be implemented Q1 or early Q2 of 2009. The revised code modifies Fannie Mae and Freddie Mac seller-servicer guidelines to improve the reliability of home appraisals and to restore appraiser independence. The code is an updated version of the agreement signed by the government-sponsored enterprises and the New York State attorney general's office in March 2008. The aim of the code is to assure that all parties involved in the mortgage market will receive fair and independent property valuations. Among other changes, the code sets in place new rules and regulations governing:
· The process for ordering appraisals
· Appraiser independence
· Improper influences on appraisers
Learn more about the Code
Proposed Interagency Appraisal Guidelines
In November, the Treasury, OCC, OTS, Fed, FDIC, and the NCUA proposed new Interagency Appraisal and Evaluation Guidelines. The agencies' new guidelines would replace the former Interagency Appraisal guidelines from 1994, change the Uniform Standards of Professional Appraisal Practice (USPAP), and further strengthen and advance appraisal and collateral evaluation policies, procedures, practices, and standards. Learn more about the new proposed interagency guidelines
What Flagstar is doing:
In response to these new rules and regulations, Flagstar is developing an automated appraisal order and fulfillment system in Loantrac that is scheduled for release in Q1 2009. If you have any questions, please contact your Flagstar account executive.
What you can do:
· Watch for further guidance on regulations at FHFA.gov
· Get signed up with an Appraisal Management Company (AMC)
· Review Doc. # 4903, Flagstar Approved AMCs
· Get in the habit of using AMCs to manage your appraisal order
· Educate your staff and coworkers on the changes

 

[ghrousseau]

Apparently Flag Star did not get the memo about Brokers ordering directly from their Pupet AMC's....


This is from Flagstar.



WE'RE COMMITTED TO YOU
Educating you on new and changing rules and regulations
New Federal appraisal rules and regulations
The Home Valuation Code of Conduct
In December 2008 the Federal Housing Finance Agency approved an updated version of the Home Valuation Code of Conduct (Code) to be implemented Q1 or early Q2 of 2009. The revised code modifies Fannie Mae and Freddie Mac seller-servicer guidelines to improve the reliability of home appraisals and to restore appraiser independence. The code is an updated version of the agreement signed by the government-sponsored enterprises and the New York State attorney general's office in March 2008. The aim of the code is to assure that all parties involved in the mortgage market will receive fair and independent property valuations. Among other changes, the code sets in place new rules and regulations governing:
· The process for ordering appraisals
· Appraiser independence
· Improper influences on appraisers
Learn more about the Code
Proposed Interagency Appraisal Guidelines
In November, the Treasury, OCC, OTS, Fed, FDIC, and the NCUA proposed new Interagency Appraisal and Evaluation Guidelines. The agencies' new guidelines would replace the former Interagency Appraisal guidelines from 1994, change the Uniform Standards of Professional Appraisal Practice (USPAP), and further strengthen and advance appraisal and collateral evaluation policies, procedures, practices, and standards. Learn more about the new proposed interagency guidelines
What Flagstar is doing:
In response to these new rules and regulations, Flagstar is developing an automated appraisal order and fulfillment system in Loantrac that is scheduled for release in Q1 2009. If you have any questions, please contact your Flagstar account executive.
What you can do:
· Watch for further guidance on regulations at FHFA.gov
· Get signed up with an Appraisal Management Company (AMC)
· Review Doc. # 4903, Flagstar Approved AMCs
· Get in the habit of using AMCs to manage your appraisal order
· Educate your staff and coworkers on the changes

Either that or the fix is in and they know that the HVCC will be changed to allow mortgage brokers to order from management companies directly. I don't like the idea of giving the AMC more control over the appraiser, but from a logistical standpoint, not allowing a broker to order an appraisal upfront to submit with the loan approval is going to disrupt the marketplace tremendously. Also, it will place extreme pressure on appraisers for turn times in order to meet rate lock deadlines. I can't see how this portion of the HVCC will not be modified.

 

[Kevin Mc]

Mortgage brokers will be completely removed from the appraisal process. Once they turn over the file to whomever they are dealing with on the secondary market, only then will the appraisal be ordered. Fine with me.

That is wrong. The mortgage broker can and will order the appraisal from an AMC. The AMC will then order the appraisal thus keeping the MB out of the actual ordering process. The lender typically will not be ordering appraisals for the MB. They want the complete package with an appraisal provided by the AMC.

 

[Kevin Rising]

Q33.
May a mortgage broker order an appraisal directly from an appraisal management company that was specifically authorized by the lender?
No. The Code prohibits brokers from ordering appraisal services.

 

[Bigrock]

Q33.
May a mortgage broker order an appraisal directly from an appraisal management company that was specifically authorized by the lender?
No. The Code prohibits brokers from ordering appraisal services.

So that will kill flagstars approach and if it get changed,,,I think as long as they order from an undiased third party,,we should be good to set up your own AMC.


The Bottom line is this is nothing more then a move to wipe out the small brokers and consolidate the Mtg biz in the hands of the few...

That is what is happening....

 

[ghrousseau]

So that will kill flagstars approach and if it get changed,,,I think as long as they order from an undiased third party,,we should be good to set up your own AMC.


The Bottom line is this is nothing more then a move to wipe out the small brokers and consolidate the Mtg biz in the hands of the few...

That is what is happening....

Which is exactly why I suspect the NAMB will initiate a lawsuit.

http://www.namb.org/namb/NewsBot.asp?MODE=VIEW&ID=254&SnID=1458465200

 

[Kevin Mc]

Q33.
May a mortgage broker order an appraisal directly from an appraisal management company that was specifically authorized by the lender?
No. The Code prohibits brokers from ordering appraisal services.

Let them tell that to Chase who has instructed their approved brokers to sign on with their 3 AMCs. Might it change 5/1/09? perhaps, but from what I hear Chase wholesale will not get involved in the ordering process and firmly believe they are being compliant with the HVCC.