OXFORD, MS - The Home Valuation Code of Conduct is scheduled to go into effect on May 1 and a survey conducted for FNC, a company that provides collateral management technology here, found that lenders are confident their systems will be ready to support compliance.
However, the survey also found that few of those respondents have completed the system upgrades needed to ensure readiness.
The HVCC is a settlement of a legal case involving Washington Mutual and New York Attorney General (and former secretary of Housing and Urban Development) Andrew Cuomo. Mr. Cuomo and the government-sponsored enterprises entered into an agreement that will impact how appraisals are ordered. The National Association of Mortgage Brokers is stepping up its efforts to lobby Congress in an effort to have the settlement set aside.Almost 80% of those surveyed found their systems would be ready to comply with HVCC on May 1, but only 14% had completed the work needed.
"Some lenders may not be fully aware that their systems and processes will require significant changes to avoid penalties associated with selling their new originations to the GSEs after May 1," said Jon Fisher, FNC's designated HVCC implementation expert.
When asked what systems they would use, their own or a third-party solution, the response was mixed: About 21% said they would use their own internal proprietary processes; 18% would use a vendor management company to ensure compliance on their behalf; 15% would choose a full-purpose software vendor, such as FNC; and 12% indicated they would choose multiple VMCs.
Of those who had already secured a compliance solution prior to completing the survey, most said they chose either their own proprietary system or a full-purpose software vendor; 13% selected multiple VMCs; and 6.7% chose a single VMC.
