Bill Proposes to Place Moritorium on HVCC
The National Association of Home Builders and National Association of Realtors have joined the National Association of Mortgage Brokers in panning the new appraisal code implemented by Fannie Mae and Freddie Mac two months ago... The feelings are running so high that the petition circulating to end the practice has over 35,000 signatures according to HousingWire. It sounds like Congress is listening. Now The National Mortgage News reports that two Congressmen introduced a bill last week to place an 18-month moratorium on the rules.
First the economic crisis was blamed on subprime borrowers. Then it was blamed on the credit crisis. Then it was blamed on the mortgage brokers. Then it was blamed on the appraisers. Well, borrowers with A-Paper credit are defaulting on homes at an alarming rate..strike one. Banks were given nearly a trillion dollars in TARP funds to stimulate credit, it never happened...strike two. Banks that operated as direct lenders (not mortgage brokers) have just as many bad loans on the books as anyone else...strike three. The new HVCC (Home Valuation Code Of Conduct), is proving to be cumbersome and time consuming and poorly managed and is at risk of being placed on moratorium....strike FOUR? Two simple solutions: 1. raise the FHA/Fannie/Freddie loan limit to $1 million for a period fo 24 months. 2. create a fresh start, easy to understand, credit scoring system. As consumers we should be able to design our score to an EXACT number based on our behavior. These two fixes can be implemented almost immediately, and will stimulate both purchase and refinance business. More to follow on that subject later....
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