Appraisal Fraud "Common"
The CSMonitor covers the ongoing degradation of appraiser independence. "Real-estate appraiser Karen Long isn't very busy, and she thinks she knows why. 'If you're not going to meet [their anticipated] value, they just walk away and find another appraisal,' says Ms. Long. 'It goes on all the time.'"
This state of affairs has been known for more than a year, yet how much have you heard about reform?
"'There's been an absence of strong federal action to reduce appraisal fraud, even though there's a consensus among professionals in the field that this is a major problem,' says Mr. Callahan of the Demos center."
11 Comments:
So why is it appraisal fraud and not mortgage origination fraud? If the lender is the one who goes fishing for the "correct" appraisal isn't it the lender who is committing fraud? The appraisers may have a legitimate difference of opinion, but the mortgage originator should not. There needs to be some kind of accountability applied to mortgage originators.
Are you really trying to tell me that an industry as large and nationwide as property appraisals is up to 50% corrupt?
That is ridiculous. Our government would never allow massive corruption and fraud to be the core component of what is literally the largest source of consumer spending over the last few years.
Sounds like someone needs to re-adjust their tinfoil hat. Conspiracy much?
Obviously other anonymous is not in realestate industry. Here in Washington DC area many appraisers are going way beyond boundaries to find compatible prices to find seller's price. Many are refered by the lending brokers so if appraiser do not come within seller's price they will find other appraiser that will.
---Our government would never allow massive corruption and fraud---
"I'm shocked, shocked, to find that gambling is going on in here."
"You only learn who has been swimming naked when the tide goes out."
Our government always looks the other way when fraud and corruption benefit the business elite. It's only when markets fall that all the (well known) fraud is brought to light. Funny how no one made any mention of the corrupt practices of Wall Street analysts when the stock market was going up. Once the market crashed, the finger pointing (and lawsuits) commenced.
It will be the same with fraud and corruption in mortgage lending and appraisals. Once the RE market tanks, let the perp walks begin...
Even the NAR says this is going on. I almost didn't post this as it is common knowledge in the industry.
I believe 55% is the number of appraisers that felt pressured, so the number of over-valued loans could be much higher. We don't know because no one is seriously looking into it.
(Why is it they seem to be trying to shut the barn door when the horse is already out, AGAIN!?)
That's because they don't want the horses to return to the barn.
Does no one remember the same appraisla fraud leading up to the S&L crisis? Has no one any memory?
Once again, everyone "knew" about it at the time - the druve-by appraisals, etc.
...and the GSEs are about to go the way of the S&Ls.
Heh. I see the trolling is getting more sophisticated as the FC professionals step in.
"I believe 55% is the number of appraisers that felt pressured, so the number of over-valued loans could be much higher. We don't know because no one is seriously looking into it."
As an appraiser in an asssessor's office I do not do fee appraisals on the side, but my coworkers who do (outside of the county) agree that the other 45% in the survey were not being truthful. They say that all fee appraisers get lender pressure to make the numbers work if the appraiser wants repeat business. No work, no eat. Also, an appraisal is an opinion of value, and opinions vary, so it is tough to say that an appraisal is fraudulent. And no appraisal can insure against a market drop.
2:45 Anon-
What do residential RE appraisals look like these days? Is the comparable sale figure like 2x the replacement cost and capitalization of income figures? Or do the latter get "massaged" too?
i lent in the massachusetts market in the late 80's and i distinctly remember white collar loan officers and bank vice presidents being marched out of offices in handcuffs. comfed savings, dime, etc. they were all in the same game when the s*** hit the fan. the fraud today makes that period look like kids play. a rising market corrects all mistakes, or shall i say covers all fraud. look at the foreclosure numbers in the hot markets, they're miniscule; all of the fraud is being covered a continuing flow of available buyers willing to pay top dollar. if and when it turns, there are going to be a lot of busy attorneys.
Post a Comment
<< Home