Who’s to Blame on the Over Appraisal Scam? »
Posted By altnrg 10 months ago in NewsThey’re pointing fingers, we’re examining the allegations.
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+ Add CommentComments So Far: 28 (view all)
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capecoralMComment removed: Retracted by user2 Replies
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stalemateComment removed: Retracted by user
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annk1-9510 months ago
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MMy appraiser all but begged me to take a bigger loan than I did. She said" you're eligible for a third more". I knew what I could pay for, and a bigger loan wasn't in the cards. I well believe the mortgage companies wanted to float more dollars, for more in their pockets. The realtors wanted to float more dollars, for a bigger percentage. The banks didn't care, they were selling the paper. Home investors just wanted to "flip" as quickly as they could, to keep prices rising. One big pyramid scheme, and it bottomed out, leaving a lot of folks holding the bag.
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Will131310 months ago
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you should have turned him into the state governing authority....
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I'm an appraiser.. and my basic attiude now and then is /was I just value real estate.. I don't give a damn about the loan.. whether you get it or not...
I once had a trainee with me... there was a mid 50ish couple in the house... the lady told me a sob story about if they didn't get the loan.. her husband couldn't get some operation he needed and would die..... when we left the trainee who knew that the value was not going to be anywhere near the amount needed.. ask... what is she going to do???... I suggested she mearusure him for a burial suit.. and buy a casket...
course I don't work directly for any lending institution.. and didn't work for MOST mortgage brokers... they for the most part are scum.....
I did a lot of work for Countrywide and in their defense .. they did NOT ONCE ask me to inflate a value..... -
capecoralMComment removed: Retracted by user
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DarkWizard10 months ago
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Unregulated, unethical capitalistic practices that believe that the dollar is god is what is to blame. The corporate executives and Wall Street pray to this god and that is the real trickle down theory at work. The problem is the Cash Cow went dry a long time ago, but the immoral and greedy decided to call debt "milk" and propped up a system built more on illusion than reality.
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So, in bailing out the "system" we've admitted that capitalism doesn't work. Because capitalism that is regulated isn't really capitalism and a system that cannot sustain itself isn't really a good system.-
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Endoscopy10 months ago
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The real problem was the compassion put into CRA etc. so the poor who really couldn't afford it could buy a home. Thank the Democrats in Congress in 1992 and President Clinton. The No down, low starting ARM, no principle for years, etc. Recipe for disaster.
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jordan1110 months ago
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Mortgage brokers and Realtors are no longer able to choose appraisers. >>>>>
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I've said from the beginning that Realtors and Brokers were not getting their 'due' from this scandal. It's obvious they were complicit in the inflating of price. Good to see someone recognized this and has corrected it. -
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ADAGUY10 months ago
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I don't necessarily think it was an appraisal scam. I think it was simply a high demand for housing that was caused by scrupulous unregulated lending practices.
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If you live in a house that would normally be worth 75K, and over six month period three houses like yours, and in the same neighborhood sell for over 100K, the appraised value of your house is going to go up. No scam, just the way things are. However, without the liberal unregulated lending, perhaps all three of the houses near you would never have gotten such an offer. In that case, your house would still be a 75K house. -
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HOUSEMD10 months ago
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congress...congress. when you put laws on the books that say " even tho this family cannot afford this house, PUT them in it". that is tantamount to shoplifting that families credit history at the very least. at worst, it allows a poor human characteristic to rear it's ugly head..GREED. that allows the family9poor dunb fool), the real estate salesman, the reality broker, the bankers, the loan companies and all the hedge fund brokers to make monet from the federal government.
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all this pain and agony was caused by the democrats, who pushed for the legislation right up to the fall. dodd, frank and cox, ALL should be prosicuted for malfesience in office. they deserve it and a whole lot more pain for the ruination of the United States. well done a$$ holes.... -
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ADAGUY10 months ago
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The imaginary laws you refer to were never put on the books in the first place. This is just another limbaugh lie!
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What was put on the books was the Community redevepolment act, which OUTLAWED REDLINING!
The law does not require you to make loans to those who cannot afford them, it merely says that you can't deny the loan because you don't like the neighborhood. If the buyer qualifies, you must loan the money.-
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DarkWizard10 months ago
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“We can put light where there’s darkness, and hope where there’s despondency in this country. And part of it is working together as a nation to encourage folks to own their own home.” — President Bush, Oct. 15, 2002
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From his earliest days in office, Mr. Bush paired his belief that Americans do best when they own their own home with his conviction that markets do best when let alone.
He pushed hard to expand homeownership, especially among minorities, an initiative that dovetailed with his ambition to expand the Republican tent — and with the business interests of some of his biggest donors. But his housing policies and hands-off approach to regulation encouraged lax lending standards.
http://www.nytimes.com/2008/12/21/business/21admin...
Yes, those dastardly democrats...
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Justice4All10 months ago
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I've delt with a lot of appraisers and there were very few that could be trusted. The spend an hour at the home and then ho to the tax records to see what the home sold previously for. They apply a correction factor. This way multiple appraisers can get the same appraisal and appear to be honest.
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The values are always high as well. They have to be high or the banks and realtors won't hire them again. -
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sharon404Comment removed: Spammer
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TheRealizer10 months ago
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I am indirectly affected by this real-estate (scam-bubble?).
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My grandson and his wife got caught up in the myth that bigger is better, and paid $155,000.00 for a house that possibly is worth $75,000.00. To compound his problems he has an ARM, I am trying to keep him on top of it but is is a losing battle.
The lender in this case has sold the note, so W F has no interest in rewriting, The bubble was a SCAM orchestrated by everyone in the business......... -
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earthlingerer10 months ago
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The appraisal scam is the equal result of municipalities and financial institutions.
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A property has a definite value. This property, if sold under normal circumstances, will also have a profit.
Municipalities appraise a property based on the value, but also understand that it can be sold. Thus, the appraisal will always be higher than the actual value of the property, to maximize tax revenues.
Of course, a financial institution will value the property as more than a municipality will, even though the municipal appraisal will be higher than the actual value of the property. The result will be a higher selling price, which in turn will synthetically increase the values of comparable properties.
Once this happens, the jerk goes full circle when the municipality sees the rise in sales prices and reassesses properties for a higher rate.
In the condition at present, municipalities have increased their budgets based on "bubble" prices.
And then taxes and "user fees" raise to cover everyone's a$$ets. -
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earthlingerer10 months ago
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This whole appraisal scam is the fault of financial institutions and municipalities. To blame congress is ignorant, in the nicest terms.
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Municipalities assess properties based on their actual value, plus some of a potential profit that could be made. They value at more than the actual value to maximize tax revenue.
Because the local assessment is actually higher than the actual value, a financial institution will then appraise a property higher in order to maximize a profit from it, whether it is the price of a lease, or a sale.
These appraisals are then padded twice - once by the municipalities' overassessment to maximize revenue, and then by the financial institution to maximize a profit.
Then the jerk goes full-circle when the municipality sees this artificial value created, and reassesses the property even a bit higher because of this.
At this point, localities have increased spending based on the inflated value of the property, and people are borrowing more money to pay for the altered value of the property, or refinancing against this imaginary number.
At some point or another, this all stops and crashes and burns. The bubble bursts. "Value" disappears instantly. -
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2009investor9 months, 1 week ago
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Appraisers base their valuation on an open market - sales of recent comparable homes and market trends. If this months sale prices are higher than last months more weight is given to properties that are up for sale. IF trends are lower than an adjustment should be made lower than recent sales. Appraisers aren't economists. It's up to the lender/investor to determine the risk of lending their money and to know when to put on the brakes. In this case, it was after the car crashed..!
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