| What is the HVCC about? It is essential to | | | | considerable amount of time, many sellers prefer |
| understand this first before we can fully grasp the | | | | cash arrangement. This does not favor buyer |
| effects it has on the mortgage processes. The | | | | who rely on mortgage to purchase a property. |
| HVCC is short for the Home Valuation Code of | | | | Many buyers are finding it difficult to obtain a loan |
| Conduct. This took effect last May 1, 2009. This | | | | as well because of the added requirements. The |
| aims to change the appraisal system of the | | | | process is stricter too, which makes it more |
| various properties. This affects the role of the | | | | difficult for them to qualify. Appraisers are facing |
| different parties involved in the real estate | | | | problems as well. If they join a group, the rate is |
| transaction. This came about because of the | | | | lower. More groups are turning to new appraisers |
| various malicious appraisals in the past, which | | | | because the experienced ones are not ready to |
| made the buyers pay more than they should. | | | | accept such new terms. |
| One of the changes is the role of requesting | | | | What the HVCC wants to do is good. It wants to |
| appraisal. The loan officer no longer has the right | | | | eradicate practices that are taking advantage of |
| to order such procedure. He should not take part | | | | the home buyers. This is what the industry needs, |
| in the choosing of an appraiser as well. In addition, | | | | an honest valuation of the properties for sale. |
| the appraiser to be chosen has to be a member | | | | However, for most professionals, this will give |
| of a group of appraisers. If a second appraisal is | | | | additional burden to the buyers not only because |
| necessary, a new appraiser from a new group of | | | | of the prolonged, stricter and more difficult |
| appraisers has to be chosen. | | | | mortgage process. This could also mean additional |
| The main purpose of the HVCC is to eliminate the | | | | rate they need to pay. |
| fraudulent valuations done in the past that | | | | There are several problems brought by the HVCC |
| contributed in the problems faced by the industry | | | | law. Amidst its goal to stop fraudulent valuation of |
| today. It aims to promote honesty and integrity | | | | properties, many are not happy about it. This is |
| to the appraisers. However, many contest its | | | | probably because of the change it has created to |
| ability to resolve the problem of the industry. | | | | the old ways of the different processes involved. |
| Many think that this will only add more problems | | | | Most valuations of new appraisers are inaccurate |
| to the issues face in the real estate realm. | | | | and this has been expensive for most agents. It |
| Moreover, this has affected all parties in the real | | | | will take time before everyone can work with the |
| estate transaction. | | | | newly implemented rule. |
| Many sellers are becoming impatient with the new | | | | Once everyone gets use to the new process and |
| law. This is because of the prolonged process of | | | | appreciate its goal, everything will be in sync again. |
| the mortgage loan application. Since this takes a | | | | Adjustments have to be made now though. |