Appraisers, Their Role in the Foreclosure Crisis & Reinvention as Appraisal Mgmt Companies
According to the Business Week article, Subprime lenders sneak into new territory: Appraisals, appraisers played one of the less publicized roles in the foreclosure crisis. Often working in conjunction with lenders and/or mortgage brokers, they pumped up the value of homes to justify large mortgages. The appraisers and their cohorts made made hefty fees from each transaction.
Crooked appraisers and subprime lenders reinventing themselves as appraisal mgmt companies.
When the foreclosure crisis hit, the real estate industry as a whole started to be investigated by government officials. The inflation of home prices was, of course, discovered in many cases. This led to new regulation for the appraisal industry, slated to take effect on May 1st. It is a “government-approved code of conduct for appraisals.”
Appraisal Management Companies: The Same Crooks Feasting at the Table
The kicker is though, many of the appraisers and appraisal companies that participated in the inflation of home prices are now reinventing themselves as appraisal managment companies, thanks to a loophole in the new legislation. And, they’re being joined by many subprime lenders who are getting into the appraisal business.
Read the entire story of crooked appraisers and subprime lenders who are reappearing as appraisal management companies.
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