Inflated numbers: Are builders, lenders and appraisers working together? (in Atlanta, GA)
A local banker is blowing the whistle about what he calls improper dealings in a metro subdivision.
One official told Channel 2 Consumer Investigator Jim Strickland that on the surface, it smacks of the housing crisis all over again.
(Editor’s note. The first appraisal did not “make value”).
“And he (the builder) said, ‘I want you to go with my preferred lender, Brand Mortgage. They’ve never had a problem getting the value needed,'” he said.
In a filing with federal regulators, Brand Mortgage admits it has partial ownership of its own appraisal firm, Valuation Management Group.
VMG dispatched a different appraiser.
“And they came back with a value $25,000 higher than the original appraisal. The same as the sale price, coincidentally,” Laymac said.
Check out the article and the short video of the news story. Worth waiting for the commercial to be over.
My comment. Nothing new. I quit doing new home tract appraisals many years ago. Builders have been pressuring appraisers for inflated values for as long as I have been appraising – in good and bad markets. They try to get higher appraisals so they can increase their prices. Borrowers, including appraisers, just want to get their purchase loans. No comments below the original story. What do you think? Post your comments below!!