HVCC Code

What is HVCC?

Effective May 1, 2009, the Home Valuation Code of Conduct (HVCC) establishes specific requirements for appraisal reports on all loans sold to either Fannie Mae or Freddie Mac. Its ultimate goal is to ensure that appraisers are able to arrive at a fair and accurate property valuation in accordance with the processes set forth by USPAP; without any appropriate influence or pressure to arrive at a predetermined value.

Highlights of the HVCC

Loan Production Staff includes the broker, loan officer or any other employee "responsible for generating loan volume or approving loans as well as their subordinates. This would include any employee whose compensation is based upon loan volume or the closing of a loan transaction."

• Loan Production Staff (are forbidden to select, recommend or influence the selection of an appraiser (HVCC Section III B)
• Loan Production Staff are not allowed to ask for comp checks (HVCC Section I B.5)
• Loan Production Staff are not allowed to provide estimated or target values (HVCC Section IV B.4)
• Loan Production Staff are not allowed to have any substantive communications with the appraiser. (HVCC Section IV B.3)
• Lenders (or a third party authorized by the lender) may require the borrower to reimburse them for the cost of the appraisal fee as a cost of doing a loan. The borrower may not pay the appraiser directly (NO COD orders). (HVCC Section III.A)
• The Lender shall ensure the borrower is provided a copy of the appraisal report no less than 3 business days prior to the closing unless the borrower waives this requirement. (HVCC Section II).

The full 6 page HVCC regulations can be found here: HVCC Regulation

The FAQ on HVCC can be found here: HVCC FAQ by Fannie Mae