In a letter to New York Attorney General Andrew Cuomo, the Federal Housing Finance Agency’s (FHFA) Interim Director, Ed DeMarco, announced that the Independent Valuation Protection Institute (IVPI) will not be implemented by Fannie Mae and Freddie mac. The two government sponsored enterprises (GSE) will instead implement a targeted appraisal complaint process for the Home Valuation Code of Conduct (HVCC).
Sounding much like the sort-of announced IVPI complaint form from November 2009, the GSEs will offer a standard form for appraisal complaints. The GSEs will act on suspected acts of fraud and violations of HVCC. The form should be available in weeks.
Mr. DeMarco cites the use of substantial tax payer funds on the GSEs as the primary reason the IVPI will not be implemented. “In light of the billions of dollars in taxpayer funds the Enterprises have drawn since entering conservatorships, I cannot, as conservator, justify the Enterprises funding the Institute. Therefore, as conservator, I have determined that they will not proceed with that portion of the Cooperation Agreements.”
The National Association of Realtors (NAR) has long called for the implementation of the IVPI. As recently as April, NAR President Vicki Cox Golder called on FHFA to implement the Institute. FHFA’s General Counsel Alfred Pollard responded in a letter Dated April 20, 2010 saying “FHFA continues to work with Fannie Mae, Freddie Mac and the Attorney General’s office on the Institute” and that “FHFA recognizes the value of a formal complaint process as envisioned with the Institute and continues to work towards that end.”
As of this posting, the NY AG had not released a comment.