Dealing With HVCC Misconceptions
NEW YORK - There are widespread misconceptions about the Home Valuation Code of Conduct, said an executive at an appraisal process management solutions firm, Global DMS, that could leave lenders and correspondents exposed to possible violations.Meanwhile, one appraisal management company has come up with what it calls an HVCC-compliant solution that mortgage brokers can use.Among those misconceptions, said Vladimir Bien-Aime, president of Global DMS, Lansdale, Pa., is that "quite a few companies are under the assumption that using an AMC, will eliminate their liability in HVCC compliance. This is simply not the case and can leave them exposed to compliance violations."First of all, lenders or correspondents are not required to an AMC, he said. They can use an independent appraiser and still be in compliance with HVCC, a settlement between New York Attorney General Andrew Cuomo and the government-sponsored enterprises. "But they'll need to do business with those independent appraisers in a manner that's compliant with HVCC guidelines."Another misconception is that cash-on-delivery payments are permitted under HVCC. "COD payments are going away, so lenders and correspondents are going to have to manage prepayments in addition to managing the appraisal process," he says. "For some, this will be a big issue." Global DMS' software will allow users to set up automatic payments.Global DMS is offering an automated solution through its Oasis software, for lenders and originators to manage compliance with HVCC."The processes associated with manually managing the appraisal process can account for as much as 15% of a company's total internal cost of origination, while also leaving companies exposed to HVCC violations," said Mr. Bien-Aime, adding that compliance with the guidelines doesn't have to be difficult, costly or arduous.The broker-facing solution comes from DartAppraisal.com, Troy, Mich., and is called DartExpress.Brokers who use DartExpress login and pick from a list of lenders who have authorized DartAppraisal to process the appraisal order.The user pays online with a credit card, providing immediate credit verification and processing of the order without many of the common delays associated with consumer appraisal coordination.Mortgage brokers can track up to seven steps in the appraisal pipeline via the DartAppraisal.com Web site to determine the status of each order in the account. The viewable tracking process includes receipt, acceptance, scheduling, appointment set, inspection, quality control and possible addendums. Notations of any complications which may have arisen within the process are also visible.A copy of the appraisal is provided to both the mortgage broker and lender.