Okay, first, I have a confession to make. The bank that I work for chose to be proactive and we began implementing the Home Valuation Code of Conduct on mortgage applications taken on or after January 12. Why did we do it so early? I’m not going to attempt to read the minds of the corporate people on that one.
I am going to share what I’ve learned about the Home Valuation Code of Conduct and what it means for lenders, Realtors and consumers. Please remember this is not a formal analysis of the rules of the HVCC, this is strictly my personal experience of what it means:
The Five Most Important Things About the Home Valuation Code of Conduct:
1. For consumers – it means that the cost of an appraisal has gone up. 6 months ago, a standard appraisal in my area would cost between $275 and $300. Now, that same appraisal is going to run $375. What does the consumer get for his additional $75? Basically, he gets one thing. He gets a bit more comfort that the appraiser isn’t necessarily a friend of the Realtor or the lender and he doesn’t need to be as concerned that the appraiser is being pressured by someone to “meet a number” so the deal gets done.
2. For Realtors – it means that they can’t rely on “a friend” to get the deal done. The days of working with the local appraiser who knows pretty much the entire market are over. Now they have no impact on who does the appraisal. So what does that mean? It means that they are probably going to be getting some appraisers who don’t know the market as well. What does that mean? It means the Realtor has to not only know the market, they have to have the data available and be able to pass that information quickly and easily to the appraiser. I don’t believe that it would violate any rules if the Realtor were to look up what they feel are the 6 best comparables, print the information and have it waiting at the house Read more