HVVC Rules and how to get around them.

If you are in the process of working with a loan officer to get a mortgage, chances are that you have heard about the HVCC rules for appraisals and how your loan officer “can’t talk with the appraiser”.

True, the HVCC rules are designed to stop the loan officers from speaking with the appraisers because in the past, the people who made the laws felt like too many times the loan officer “pressured” the appraiser into providing a higher-than-otherwise-would-be value for the home, and so the practice of loan officers talking to appraisers is now taboo.

But a simple way around this is for you the person who owns the home and is taking out the mortgage to speak directly with the appraiser.

When the appraiser comes by to inspect your home, make sure that you know the loan-to-value ratio and what your total loan amount are.

Make sure that he knows both of these numbers – because if he knows these two numbers, then he knows what the loan officer is estimating the value of the home to be.

And while this practice won’t help if your home is worth 50% of what the loan officer estimated, you may be surprised how many deals I have seen fall apart over a difference of $5,000 because the appraiser was in the dark about what the LTV and loan amount were. So while it isn’t perfect – it is the best thing that you as a borrower can do right now to ensure that you don’t get caught up in the HVCC nightmare.

The cold hard fact is you as the consumer are paying for the appraisal.  Nothing is worse than finding out you are a couple of thousand off from making you deal work.  Does a few thousand really matter on a $200,000 house.  Probably not.  An Appraisal is not an exact number.  It is an opinion of value and the key word is opinion.  Have two appraiser give a value to a home and you are likely to get two different numbers.  Close but different.