FNC Survey: Most U.S. Lenders Ready to Comply with HVCC

OXFORD, Miss., April 1 /PRNewswire/ — At just one month out, U.S. mortgage lenders are confident that their systems will be ready to support compliance with the Home Valuation Code of Conduct by the imposed May 1 deadline, yet few say they have actually completed system upgrades designed to ensure compliance.

These conclusions result from a survey distributed last week to more than 1,000 key contacts of mortgage technology company FNC, whose clients include the nation’s major mortgage lenders as well as regional and community banks.

On May 1, the Home Valuation Code of Conduct is scheduled to take effect, mandating that all new loan originations sold to Fannie Mae and Freddie Mac comply with strict rules established to mitigate the risk assumed by these two government-sponsored enterprises (GSEs). FNC has repeatedly urged its clients and other lenders to immediately update their internal systems and processes for any loans they plan to sell to the GSEs.

According to the survey, almost 80 percent of respondents felt confident that their systems would be ready to comply, but with the deadline a month away, only 14 percent had completed the necessary upgrades.

“Some lenders may not be fully aware that their systems and processes will require significant changes to avoid penalties associated with selling their new originations to the GSEs after May 1,” said Jon Fisher, FNC’s designated HVCC implementation expert. “Even those that think they are in compliance need to make sure by contacting us or their internal compliance groups immediately.”

When asked what systems they would use–their own or a third-party solution–the response was mixed: About 21 percent said they would use their own internal proprietary processes; 18 percent would use a vendor management company (VMC) to ensure compliance on their behalf; 15 percent would choose a full-purpose software vendor, such as FNC; and 12 percent indicated they would choose multiple VMCs.

Of those who had already secured a compliance solution prior to completing the survey, most said they chose either their own proprietary system or a full-purpose software vendor; 13 percent selected multiple VMCs; and 6.7 percent chose a single VMC.

FNC President Jeff Triplette said FNC solutions can ensure that the lenders’ valuation processes are in compliance before the loans are sold to the GSEs.

“FNC pioneered real estate collateral information technology,” Triplette said. “Since 1999, FNC has offered solutions that automate appraisal ordering, tracking, documentation and review for lender compliance with OCC, OTS, Federal Reserve, FDIC, and other regulations, including appraiser independence and GSE guidelines. As a result, FNC’s lender clients–the nation’s major lenders–have realized reduced costs and more efficient loan processing.”

About FNC, Inc.

With its collateral management platforms and collateral-focused data and analytics, FNC provides advanced insight into the property backing a loan from origination to capital markets. No one understands real estate collateral better than FNC. Visit FNC online at www.fncinc.com.

    To interview Jon Fisher, Jeff Triplette, or any of FNC's mortgage industry
    experts, contact:
    Bill Dabney, PR specialist
    FNC, Inc.
    Phone 662/236.8304
    bdabney@fncinc.com

SOURCE FNC, Inc.