Vendor Sees Misconceptions as HVCC Deadline Approaches

Global DMS LLC, Lansdale, PA, a commercial and residential real estate valuation software solutions provider since 1999, said it considers many lenders and correspondents to be not fully prepared to comply with the Home Valuation Code of Conduct, which goes into effect on May 1. Global DMS executives said "widespread misconceptions are leaving lenders and correspondents exposed to possible HVCC violations." One example, judging from the "numerous calls" president Vladimir Bien-Aime said the company has recently received from companies trying to get ready, is that, "quite a few" are under the impression that using an appraisal management company will eliminate their liability in HVCC compliance, and he said that leaves them exposed to compliance violations. Further, some lenders are not aware that if they follow HVCC guidelines they can also use independent appraisers and still be HVCC compliant. Other misconceptions include the belief that it will require a huge capital investment to become HVCC-compliant, or that COD payments are still widely accepted. In fact, he said, compliance costs are low and COD payments are going away, "so lenders and correspondents are going to have to manage prepayments in addition to managing the appraisal process."