No HVCC for Reverse Mortgage Industry Says FHA Commissioner

The Federal Housing Administration has no plans to implement the Home Valuation Code of Conduct (HVCC), said Commissioner David Stevens to a delegation from the National Association of Mortgage Brokers (NAMB).

Stevens said that he was well aware of the problems originators have been having with the code, and that FHA is not considering adopting the appraisal system now in place at Fannie Mae and Freddie Mac.  However, HUD is looking at alternatives that will insulate appraisers against inappropriate pressure said a statement from NAMB. 

NAMB’s statement also said that FHA is concerned about potential loses in the reverse mortgage (HECM) area.  HUD says that due to declines in home values, variable rates, and the fact that people are living longer, they may be forced to change the program. 

HUD also intends to issue new directives on appropriate advertising for HECMs (about time).  They are concerned that some advertising promotes seniors using the cash from their residence and spending it on vacations and expensive personal items.  A Mortgagee Letter on HECMs is expected within 60 days. 

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