Thursday, December 17, 2009

Some fear appraisal reform bill too limited

by J. Craig Anderson - The Arizona Republic

"A U.S. House bill that would cancel out recently imposed rules to make home appraisals more objective has some metropolitan Phoenix mortgage brokers and real-estate agents cheering. But their celebration might be premature, given that major banks seem to favor the existing system...

"Many real-estate sellers, appraisers, agents and brokers have criticized the existing rules, implemented May 1 in an HVCC update, which forbid direct contact between brokers and appraisers, and effectively require the use of intermediaries known as appraisal-management companies. They say those management firms have become too powerful.

"Appraisers also have complained that they have not been adequately compensated since the new HVCC took effect, a problem HR 4173 seeks to correct.

"The code's harshest critics have been mortgage brokers and real-estate agents. Both groups say the new system costs consumers more, takes longer and produces unreliable appraisals.

"Lenders are in complete control of the appraisal system - two of the biggest banks own their own appraisal-management firms - and so far, no one is talking about forcing them to conduct business differently."

The complete article is here.

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