HVCC Compliance is Easier Than You Thought

The requirement for HVCC compliance is changing the way Appraisers, Lenders, Mortgage Brokers, Clients and REALTORS® interact to get the deal done. HVCC Compliance and appraiser independence can be maintained while still permitting Lenders and Mortgage Brokers to work with their preferred local appraisers.

The Mercury Network

The Mercury Network, from a la mode, provides a well-executed appraisal order management solution for Lenders and Mortgage Brokers and eliminates the need for appraisals to be run through AMCs.

Best of all, it is FREE.

What is the HVCC?

The HVCC (Home Valuation Code of Conduct) mandates that all lenders separate anyone on the sales side of the business (loan originators — the loan officers and loan processors) from appraisers, or that they put in place “prudent safeguards” to ensure that a commissioned employee can’t influence an appraiser in any way.

AMCs Are Not the Answer

In early to mid-2009, many lenders began funneling their appraisal orders through Appraisal Management Companies (AMCs) and all but abandoned the relationships they had cultivated over the years with local appraisers in each area where they did business. By early 2010, however, it had become clear that although AMCs can provide a buffer layer between Lenders and Appraisers, this service frequently comes with a whole host of undesirable problems. Many real estate transactions fell through, to great detriment of the industry (and, of course, to the buyers and sellers). This failure has widely been attributed to AMCs sending appraisals to the cheapest appraiser, or the one that could get it done the fastest, as opposed to sending the orders to the appraisers with demonstrated expertise in a market area or type of dwelling.

Out of area appraisers may be cheaper than local experts, which makes them attractive to AMCs, but they rarely know the characteristics of the local market that add (or detract) from the value of property. One key item to note is that although AMCs demonstrably send appraisals to lower-priced appraisers (or to those appraisers who will accept less than their established, or traditional fee), that cost savings is not passed on to the consumer. Consumers (buyers of real estate) are paying the same, or higher fees for appraisals than they were prior to the passing of the HVCC.

Customers Pay Higher Appraisal Fees – Appraisers Earn Less

Yes, you read that right: the Appraisers are getting paid less per appraisal, yet the Consumer is paying more. The fee taken by an AMC can be 50% (or more!) of the amount paid by the consumer for the appraisal.

Better Option for HVCC Compliance?

The Mercury Network IS the Answer: Stay HVCC Compliant and Choose Appraisers with the Market Area Experience that permits Effective, Defensible Valuation of Property

The Mercury Network solves this problem (protecting appraisers from undue pressure from lenders to come in at value, among other things) by operating in a “double blind” mode that hides the identity of the appraiser and the lender, making it easy for the two to communicate while still maintaining HVCC compliance. The Mercury Network has tens of thousands of appraisers already registered and ready to accept orders. The appraiser selection system lets you take into account factors like turnaround time, percentage of orders selected, proximity to subject and more for maximum flexibility.

For lenders that still allow loan originators to communicate directly with appraisers (which is allowed in many situations) they’ll appreciate Mercury Network’s audit trail of communications that ensures complete transparency during the entire process. Simply put: It’s a solution that meets your needs as a lender no matter what level of separation you decide is prudent. And with Mercury Network, a lender can use the same appraisers they’ve known and trusted for years.

In addition to HVCC compliance, Mercury Network includes numerous time saving features to make the process of managing appraisal orders more efficient. One example is the delivery system used by the appraiser which incorporates a customizable set of review rules that run before the appraiser sends the report, thus increasing loan production staff efficiency with fewer re-sends.

a la mode’s Real Estate Services are Everywhere You Want to Be

You Probably Already Depend on a la mode technology.

Over 50% of all appraisal reports today come through a la mode in some way. Since 2002, a la mode’s servers have managed tens of millions of appraisals for over 200,000 mortgage professionals. That same reliable backbone that has been behind thousands of appraiser’s business websites is what’s driving Mercury Network today. Of course, if you simply look at the bottom of your appraisal reports, chances are at least half of them have “a la mode” in the footer. So rest assured a la mode which has been producing real estate software since 1986 is no newcomer to the industry.

To learn more about how Mercury Network uses technology to streamline your workflow and allows you to remain HVCC compliant, visit Mercury Network at www.mercuryvmp.com. Or contact a la mode, creators of the Mercury Network, at 1-800-434-7260.

Add Orlando Masis to Your Appraiser Panel

Please remember, when you join the Mercury Network, add Orlando Masis (Appraisal IQ) as one of your local appraisers for Austin and Central Texas. We guarantee that you will be satisfied with the quality of the analysis and the quality of the report – we adhere to the highest of standards, professionally, ethically, and personally.