Comptroller of the Currency John Dugan has sent a letter to Office of Federal Housing Enterprise Oversight (OFHEO) Director James Lockhart criticizing the Home Valuation Protection Program and Cooperation Agreements, which were signed by OFHEO, New York Attorney General Andrew Cuomo, Fannie Mae and Freddie Mac.
‘The [Office of the Comptroller of the Currency] has substantial concerns about the unintended adverse consequences of the agreements and code for the safe, sound and efficient operation of national banks' residential mortgage lending activities, as well as for the cost of mortgage credit to consumers,’ Dugan writes.
According to Dugan, the appraisal pact will undermine the quality of home appraisals, increase lenders' origination costs and consumers' prices, and disrupt the appraisal process. He additionally claims that the pact ‘directly conflicts with various ongoing federal efforts to restore credit availability and confidence in the housing and mortgage markets’ and raise numerous legal issues.
Source: Office of the Comptroller of the Currency