| 1. |
Prohibited Communications:
Loan production staff members, their subordinates and any person who is compensated on a commission basis upon the completion of a loan are prohibited from selecting, retaining, influencing, or recommending appraisers. |
| Q. |
We currently have our Processers order our appraisals. Is this compliant with the HVCC? |
| A. |
No.
Loan Production Staff refers to loan originators, interviewers, underwriters, and loan processors. The term can also refer to any member who is involved in the loan process, including tellers and customer service representatives. *1 - taken from Federal Reserve Bank of Boston. |
| Q. |
I thought the HVCC only precluded mortgage brokers from selecting appraisers? |
| A. |
No.
The HVCC does preclude mortgage brokers from ordering appraisals. It also prohibits anyone on the lender’s loan production staff from selection, retaining, influencing or recommending an appraiser. |
| Q. |
As a Credit Union or Bank, does the HVCC apply to us? |
| A. |
Yes.
The HVCC applied to any lender selling to Fannie Mae or Freddie Mac. |
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| 2. |
Required Notices:
Lenders must notify appraisers and borrowers of the Independent Valuation Protection Institute (IVPI) services, including a hotline for complaints of HVCC non-compliance. |
| Q. |
Does SettlementOne provide a copy of the required notice to the appraiser selected? |
| A. |
Yes.
Upon setup with our system we provide each appraiser a copy of the notification |
| Q. |
Does SettlementOne provide a copy of the required notice to the borrower? |
| A. |
Yes.
Each time we return an appraisal to the system we attach a copy of the notification so when the lender provides a copy of the appraisal report to the borrower it is attached as required. |
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| 3. |
Duty to Test Quality:
Lenders must establish quality control procedures and report the results of the quality control testing to the Independent Valuation Protection Institute and any relevant regulatory bodies. |
| Q. |
Does SettlementOne provide quality control on the appraisals provided by SettlementOne? |
| A. |
Yes.
Each time an appraisal is delivered to the lender it must pass SettlementOne's QC process. |
| Q. |
What percentage of appraisals must have quality control testing performed? |
| A. |
Ten percent.
In addition to basic QC procedures on every appraisal, SettlementOne will conduct a quality testing process as required by the HVCC on ten percent of the appraisals and provide the report to lender. This quality control process includes running an automated valuation model, broker paid opinion, or a desktop review. Lender receives the complete audit package from SettlementOne monthly. |
| Q. |
What is the Independent Valuation Protection Institute? |
| A. |
The GSEs also agreed to provide $12 million each over a 5-year period to fund an "Independent Valuation Protection Institute." A separate and independent organization, the institute would provide an appraisal complaint process, mediation of appraisal disputes, and mortgage fraud reporting. |
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