|As service providers rush to help mortgage lenders comply with the requirements of a new appraisal code that goes into effect next month, mortgage brokers have dropped a lawsuit against the regulator of Fannie Mae and Freddie Mac.
The National Association of Mortgage Brokers Tuesday sent a letter calling on Congress to stop or delay the imminent implementation of the Home Valuation Code of Conduct. The group claims the code will increase mortgage costs for borrowers and aggravate the credit crisis and previously filed a lawsuit against the Federal Housing Finance Agency to block its implementation.
NAMB said the HVCC conflicts with a final rule issued in July 2008 by the Federal Reserve Board that prohibits mortgage brokers and mortgage bankers alike from attempting to influence appraised values. The trade group claims that the comment process was inadequate.
"As it stands today, the HVCC will take effect on May 1, 2009, and this rule overwhelmingly favors lending institutions to the detriment of mortgage brokers, appraisers, and consumers," the letter said. "HVCC targets mortgage brokers and independent appraisers."
But the trade group today said it dropped the lawsuit "to assess means by which we can refute the FHFA's claim that no court may review their decisions while the government sponsored enterprises are in conservatorship," NAMB President Marc Savitt said in a statement. "All companies, investors, and trade groups should understand there may not be a court, any court, able to hear their case while FHFA is utilizing their conservatorship powers."
MortgageDaily.com advertiser Global DMS announced today that it is well ahead of the rush to provide HVCC compliance services and has been providing appraisal management tools for a decade. Its platform includes an impartial online appraiser selection process, integrated valuation forms and real-time tracking. The system also reportedly enables electronic report delivery, appraiser scoring and a live help desk.
"Some vendor products only offer partial solutions which leave lenders having to combine purchases of different products and deal with the problems of making them work together," GlobalDMS said. "Many of these programs have difficult end-user learning curves, long implementation timeframes, a lack of centralized control, and poor customer support."
Flagstar Bank has selected StreetLinks National Appraisal Services as its preferred national appraisal vendor.
StreetLinks, also a MortgageDaily.com advertiser, said in a March 31 statement that it will provide "Flagstar's brokers, correspondents and branches with a comprehensive suite of fully compliant and warranted valuation of products." StreetLinks said its appraisals are "fully compliant" with HVCC and "all other current and pending regulations."
SharperLending LLC said in a March 24 statement that it has experienced a "surge of usage" in its Appraisal Firewall product since the release of the HVCC rules. The product helps local and regional banks, credit unions and appraisers stay in compliance with the rules while enabling them to bring their established relationships to the platform.
"With HVCC compliance and the related buyback obligations for non-compliance, many lenders want more control over their appraisal process to make doubly sure they are compliant with the objectives of HVCC," Dave Black, president and chief executive officer of SharperLending, said in the statement.