In fact, the industry wide statistic is that appraisal rebuttals (aka challenges) under TILA Section 129E(c) is 30%.
(At our company, appraisal rebuttal is 2.9%. An AMC does not choose the appraiser.)
The Doddâ€“Frank Wall Street Reform and Consumer Protection Act H.R. 4173 was signed into law on July 21, 2010. Appraisal procedures fall under Title XIV - Mortgage Reform and Anti-Predatory Lending Act, Subtitle F - Appraisal Activities
"Within one year, the Government Accountability Office shall conduct a study on the effectiveness and impact of various appraisal methods, valuation models and distribution channels, and on the home valuation code of conduct and the appraisal subcommittee."
HVCC is no longer in effect. Section 1472, Title XIV Mortgage Reform and Anti-Predatory Lending Act of Dodd-Frank Act (HR 4173) called for the sunset of HVCC 90 days after enactment of the Bill. That date was October 21, 2010. The comment period ended 60 days later. As required by the Dodd-Frank Act, the Federal Reserve issued an interim Final Rule on October 18, 2010. This rule was issued in order to ensure the independence of the appraisers and the requirement that appraisers are to receive â€œcustomary and reasonable payments for their services.â€ The interim Final Rule issued by the Federal Reserve is mandatory and effective April 1, 2011.
What this means is that HVCC is the past, although many lenders continue to use AMC's. The act provides specifically that: "When the Board promulgates the interim final rule, the Home Valuation Code of Conduct, the current standard for appraisal independence for loans purchased by Fannie Mae and Freddie Mac, will have no further force or effect."
The present is Fannie Mae and Freddie Mac Appraiser Independence. These are codified in section 1472 of the act.
The future is the Federal Reserve Final Rule.
Most of my business in non-conforming. No lender/investor allows us to choose the appraiser. Even on our Correspondent and Direct Lending. This has nothing to do with Fannie/Freddie. It has to do with the lender.
Happy funding, Rudi
Happy funding, Rudi
Michael Emerson, REALTOR, 949-295-6224, firstname.lastname@example.org
If you are looking for one of the other 4 options (USDA would be out since Dana Point & vicinity isn't eligible) above, then you would likely be looking for a community bank which has it's own roster of appraisers, as these community banks would be used to lending in their area so they wouldn't need to have an AMC to select an appraiser for them... even though no AMC is used, it'd still be on a "Round Robin" system though. This would not be your large chain lenders like BofA, WF, etc., they would instead be similar to Farmers & Merchants Bank, California Bank & Trust, Pacific Western Banks (these are all just banks in the South OC area - I have *no* clue if they use an AMC or their own roster of appraisers).
Mortgage brokers you think, by default, would have a lot of options... but mortgage brokers broker a loan to a lender, and those lenders barely trust brokers originating loans (OK that is a very big exaggeration but brokers loans come under greater scrutiny - it was just emphasizing the point), so brokers will almost always have to rely on an AMC (unless they are brokering a loan to one of those community lenders like I named above, which usually do not offer relationship to mortgage brokers).