Aubrey Cohen of the Seattle PI wrote an article interviewing several mortgage professionals about HVCC and how it's impacting local real estate transactions, including me. From the article:
But even Porter had one transaction held up for more than two weeks because of a [a bank's] appraisal management company review, jeopardizing the transaction's interest-rate lock.
"It's creating havoc for people who are trying to sell their homes and not allowing some homeowners to refinance at lower rates (possibly preventing a future foreclosure)," Porter wrote in an e-mail.
Mortgage Master is a Correspondent Lender and HVCC allows correspondent lenders to create their own appraisal department as long as it meets HVCC's criteria. I, as a mortgage originator, cannot have any say in selecting who the appraiser will be and I do not know who the appraiser will be on my transactions until I receive the appraisal. Appraisals are ordered by a separate department that is removed from origination or production.
What happened in the situation referenced above had to do with an appraisal that was ordered prior to HVCC's effective date. The bank the mortgage is being sold to required a field review by their AMC (even though the home came in at a slightly higher value than what we needed for the transaction). The AMC's value actually came in slightly higher than what our appraisal did–costing my client $250 in field review fees, delaying the transaction by a couple weeks and creating anxiety over a lock potentially expiring.
HVCC is hampering home values. Everyone should care about this issue and contact their representatives in Congress today…especially if you're considering buying, selling or refinancing your home. If home's in your neighborhood are appraising and selling for less due to bad appraisals, it impacts your home's appraised value–your neighbor's homes may become the sales comparables that your appraiser will have to rely on to arrive at a value of your home.