The Home Valuation Code of Conduct (HVCC) dictates rules regarding the interaction between appraisers and the lending industry. A copy of the full HVCC can be found here. On May 1, 2009, changes to the HVCC will go into effect. The changes state that rather than going to an appraiser directly, lenders must order a real estate appraisal through a third party, such as an appraisal management company.
It is important to keep in mind that these changes only affect the way that conventional appraisals are obtained and not Federal Housing Administration (FHA) appraisals for FHA-insured loans. Lenders will still be able to order an FHA appraisal directly from an FHA-approved appraiser after May 1, 2009.The underwriting requirements for an FHA-insured loan are stricter than those for a conventional loan, and the fundamental difference between an FHA appraisal and a conventional appraisal is the FHA appraiser’s focus on the health and safety of the borrower. Both types of appraisers look for standard characteristics that can affect the value of a property, such as the location of the property, the overall real estate value in the area, or a flaw that could negatively impact a home’s value, like a crumbling foundation. But an FHA-approved appraiser takes the appraisal a step further and looks for environmental toxins like asbestos, mold, and peeling lead paint; and safety features like handrails, smoke detectors, and window screens.
The certified and licensed appraisers at Present Value LLC are FHA certified and experienced with this type of appraisal. Click here to order a real estate appraisal.By: Present Value LLC
