Appraisal Portability Moves Forward

In revamping appraisal standards, federal regulators should ensure that mortgage brokers can use the same appraisal in shopping a loan to different wholesalers, according to House and Senate conferees working on final details of the regulatory reform bill. The legislation directs federal regulators to draw up new appraisal independence standards for all residential mortgages while specifying abuses and deceptive practices. In sending a counteroffer to Senate conferees, the House included an amendment from Rep. Paul Kanjorski, D-Pa., instructing regulators to ensure the "portability" of appraisals. Senate conferees have accepted the Kanjorski proposal. But work on Title XIV dealing with appraisal and mortgage issues will still ongoing as National Mortgage News went to press. Under the Home Valuation Code of Conduct, loan officers and brokers cannot directly select an appraiser and must instead rely on the funder or a management company. If the lender does not accept the loan, the broker has a hard time getting another lender to accept the appraisal, which means the consumer has to pay for another one. Mortgage brokers have been complaining about this lack of portability since HVCC went into effect May 1, 2009.