So many new mortgage-relief proposals have been coming out of Washington, D.C., in the last six months that the supply of new acronyms is beginning to run dry. And with all the new government programs, the rulebooks just keep getting thicker. One can forgive mortgage servicers and lenders for feeling a bit overwhelmed. Compliance companies, on the other hand, are getting their own version of a stimulus package.
This new batch of proposals, of course, is on top of rules that have been in the works for much longer. Take, for example, the Home Valuation Code of Conduct (HVCC). This set of appraisal requirements grew out of a settlement negotiated between the New York Attorney General's Office, the government-sponsored enterprises (GSEs) and what used to be known as the Office of Federal Housing Enterprise Oversight (OFHEO). The rules have been a while in the making, but this month they take effect in their final adopted form (unless something unforeseen happens). The goal of the rules is to remove pressure on appraisal professionals to "hit the right number" with their value determinations to boost the likelihood of a loan getting approved. Our story this month titled "A New Code of Conduct" by Mary McGarity takes you through some of the controversy still swirling around the HVCC. Part of the hubbub centers on the role mortgage brokers can play in ordering appraisals.
In March, the Obama administration released details of its Making Home Affordable Program, which includes a whole new set of procedural and eligibility rules for refinancings and loan modifications for distressed borrowers. The complicated litany of requirements is...