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Goodbye, Home Valuation Code of Conduct

Legislation will overhaul appraisal rules

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Appraisers are welcoming Thursday's passage of legislation that makes sweeping changes to the nation's financial regulatory system, saying the bill includes the first modernization of real estate appraisal regulations in more than 20 years.HR 4173, the Dodd-Frank Wall Street Reform and Consumer Protection Act, includes appraisal independence requirements and provides grant funding for state oversight and enforcement of those regulations.The bill creates a new Bureau of Consumer Financial Protection that's charged -- among many things -- with drafting new interim final regulations that specifically define acts or practices that violate the bill's appraisal independence requirements.The regulations are to be drafted within 90 days of the bill's signing, superseding the Home Valuation Code of Conduct, rules adopted by Fannie Mae and Freddie Mac in May 2009.Realtors have complained that the code, which was intended to protect appraisers from coercion by lenders, has resulted in lenders rel...