Shh..., I Spoke with an appraiser today!

According t the HVCC code, I should be drawn and quartered. I may have influenced him on an appraisal value.

No, I did not break the code, because the appraiser called me. But I did have a moment to chat with him about the state of our industry.

He was not very happy about the new code, he indicated that he has taken over the spot that used to be held for mortgage brokers and loan officers. That being the lowest of the low in the real estate world.

Turns out that I am having trouble finding anyone that likes this new HVCC code. I checked out where it came from and boy was I surprised when I found that the Attorney General of the state of New York is the primary force behind its adoption.

Here's the deal Andrew Coumo used to be the head of HUD. He had a lest than stellar run in that position. After that gig he went to work with a director of a company called AMCC (appraisal management company).

Because he is the son of Anthony Cuomo a big time mover and a shaker in New York politics, Andrew gets the Attorney Generals job.

Next thing you know WAMU is getting fined for conspiring with an appraisal group to inflate prices on a ton of properties. They paid a fine in the millions. They were guilty.

So Attorney General Cuomo goes on a mission to fix the appraisal problem by separating the heavy handed influence large lenders have on appraisers.

That was the big complaint by appraisers in the past. The brokers, the banks, the credit unions, the bankers, and yes the realtors all put pressure on the appraisers to come in at unrealistic values.

According to the HVCC code, I should be drawn and quartered. I may have influenced him on an appraisal value.

No, I did not break the code, because the appraiser called me. But I did have a moment to chat with him about the state of our industry.

He was not very happy about the new code, he indicated that he has taken over the spot that used to be held for mortgage brokers and loan officers. That being the lowest of the low in the real estate world.

Turns out that I am having trouble finding anyone that likes this new HVCC code. I checked out where it came from and boy was I surprised when I found that the Attorney General of the state of New York is the primary force behind its adoption.

Here's the deal, Andrew Coumo used to be the head of HUD. He had a less than stellar run in that position. After that gig he went to work with a director of a company called AMCC (appraisal management company).

Because he is the son of Anthony Cuomo a big time mover and a shaker in New York politics, Andrew gets the Attorney Generals job.

Next thing you know WAMU is getting fined for conspiring with an appraisal group to inflate prices on a ton of properties. They paid a fine in the millions. They were guilty.

So Attorney General Cuomo goes on a mission to fix the appraisal problem by separating the heavy handed influence large lenders have on appraisers.

That was the big complaint by appraisers in the past. The brokers, the banks, the credit unions, the bankers, and yes the realtors all put pressure on the appraisers to come in at unrealistic values.

So Mr. Cuomo came up with this plan, the appraiser industry group was for it big time, initially... then he got fannie mae and freddie mac to endorse and adopt the plan. They adopted the plan way to quickly.

The rest of the real estate industry was not really sure what the effect of this new code would be. Then reality struck, appraisals started coming in with very conservative values.

Some purchase loans were killed by low appraisals, refinances, were killed right and left. The rules had changed dramatically and who was served, I repeat who was served?

Realtors, loan officers, appraisers, builders, banks, credit unions, and the consumer are being negatively effected by the effects of this code.

Wait a minute the reason for the code was to protect the consumers, right? It now costs more to get an appraisal, it takes longer, and the quality of the appraisal is inferior.

Quality appraisers are looking for a different line of work, most realtors are working in some other job just to make it through this period. Mortgage brokers and loan officers have fled the industry to the tune of 50% from just a year ago.

The cost of the code to consumers in lock time, appraisal value, equity, and loan fees is estimated at about $700 additional dollars per purchase or refinance.

Ok, so the purpose of the code was to protect consumers, well didn't we have laws in place to do that before? Yes, we did. Were these laws enforced? No, the reason, no funding to enforce. Hum....

So instead of our government enforcing the laws it already had in place, they feel it is OK to dump the cost of this stupid code on the backs of Realtors, loan officers, appraisers, builders, banks, credit unions, and the consumer.

One of the NAMB spokes persons asked the asst. Attorney General of New York this very question and they acknowledged the results were costly and they said they were OK with that.

Well I am Not!

Here is what we can do, there is currently a bill in Congress that is called HR 3044. It suspends the HVCC code for 18 months so that additional study and research can be done as to what the unintended consequences are of the Code (HVCC).

You and everyone you know needs to contact their congressman and encourage them to support HR 3044.

Do not assume the other real estate professional down the street is going to do this, he is expecting you to do this. Tell your congressman specific stories of how you have been effected by this new code.

If you do not have a story, you have not been very active in the real estate industry in the last 3-4 months.

This is a must do, if you have ever stood up for something this is something that is worth while.

One last thing, remember that the Code was designed to reduce the pressure that Banks, brokers, credit unions, builders all put on the poor appraiser to inflate the value of the real estate. Well check this out, the code allows for Banks to own up to 20% of the appraisal management companies. Is that a potential conflict of interest? Something to think about...