To help enhance the integrity of the home appraisal process in the mortgage finance industry, in March 2008, Fannie Mae entered into an agreement with their regulator the Federal Housing Finance Agency FHFA (then the Office of Federal Housing Enterprise Oversight OFHEO) and the New York Attorney General's office to adopt certain policies relating to appraisals. As a result the nation's two largest purchasers of home loans agree to only buy mortgages from banks that meet the requirements of New Home Valuation Code of Conduct (HVCC). One of these new requirements is that banks and financial institutions order home appraisals directly.

 

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Following the public comment period, the Home Valuation Code of Conduct has been modified and will be effective for single-family mortgage loans (except government-insured loans) that are originated on or after May 1, 2009. To assist lenders with implementation Fannie Mae has provided documentation of the latest changes to the code and a FAQ (Frequently Asked Questions).

 

The HVCC will monitor and regulate appraisal selection, communication, solicitation, conflicts of interest and promote appraiser independence. Fannie Mae and Freddie Mac will require that lenders represent and warrant that appraisals related to mortgage loans originated on or after May 1, 2009 conform to the code or they will not be purchased.