Choice A: Do the right thing, appraise the property at the correct price, and never work again
Choice B: Do the wrong thing, appraise the property at the wildly overinflated price the corrupt realtor, mortgage broker and seller want/need, get the job and future jobs from the corrupt cabal, but know that you're contributing to mortgage fraud and could go to jail if the government ever wakes up.
Hmmm....
The system got gamed folks. It was allowed to spin out of control. The conflicts of interest and quid-pro-quos make the NASDAQ bubble seem like child's play. And it ain't over yet.
The dubious value-add of appraisers - As housing market slumps, price-target pressure mounts
ORINDA, Calif. (MarketWatch) -- The solicitation that Texas real-estate appraiser Jim Amorin fielded came with a quid pro quo. If he'd appraise a mixed-use Austin subdivision for $25 million, the mortgage broker promised to steer 15 more major deals his way.
"After I asked a few questions, it became clear the real value was closer to $15 million," says Amorin, vice president of Atrium Real Estate Services. "I told him I'd accept the assignment but not with a predetermined value, so he kept looking for someone who would."
The pressure on appraisers to "make loans work" -- the industry parlance for hitting the number that a lender wants on a closing contract -- has been ratcheted up as U.S. home sales and mortgage refinancing have tumbled. By law, appraisers are required to render impartial judgments.
Federal and state authorities are now pushing for tighter regulation, licensing standards and criminal penalties to keep all players in the real-estate transaction process on the level.
"Mortgage and real estate brokers are paid on commission, so they have a vested interest in seeing that loans get funded," says Ted Faravelli, manager of the California Association of Real Estate Appraisers and an appraiser for 23 years who testifies as an expert witness in mortgage-fraud cases.
"If an appraiser speaks to the facts and indicates a market is declining and in oversupply, there's a good chance deals won't be consummated and referrals will dry up."
April 23, 2007
The pressure on appraisers right now must be unbearable
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16 comments:
Economists are predicting $4/gal gasoline coming to that Hummer in the exurb near YOU. HAHAHAHA
That giant SUV with spinner rims will suck $1000/mo out of your credit cards for gas. You didn't think about that when you bought it, eh?
Mortgage and real estate brokers are paid on commission, so they have a vested interest in seeing that loans get funded
And who has a vested interest in seeing that bad loans do *not* get funded? You do, if you have money in a money market fund that buys these loans. Is your money market fund loaded up with questionable mortgage debt? If so, sell it and buy treasuries. If you don't know, read those reports in the mail you keep throwing out. Don't expect others to do your due diligence if you won't.
I'm sure everyone will be shocked, just shocked, when a year from now, at the hearings, it comes out just how widespread appraisal fraud had become.
My own Father-in-Law wanted to do ANOTHER cashout refi of their home. He didn't use me (I'm a Mortgage Broker) to do the loan because he said he knew he would need a company with a "Crooked Appraisaer" to make it work. I estimated the value of their home at around $100,000 to $110,000. They got an appraisal for $145,000. The appraiser said his office was 300 miles away.
Hey KEEFER, this is amzaing. You just broke the story that appraisers work hand in hand with lenders and realtors!!
What's on tap for tomorrow breaking news that the sun rises in the east...
Is there anyone alive who didn't know that an appraiser's report ain't worth shit? When I bought my house back in 2002, my original lender backed out. I was paying $289K, the appraiser said it was worth only $275K at most. This was during the time of homes selling in an hour with 5 offers, so I wasn't going to start over and I really loved the house. No problem, my realtor got me to another mortgage lender with a more friendly appraiser and the deal went through. And good thing he did. I sold that very same house for $431K not too long ago.
I got such a good deal on my home the appraiser had a hard time with the property valuation because it was so much higher than the sellers price.
I got it for 30% off of the valuation.
It was fun to watch him struggle with what I was paying and his report of the real "value".
Over night all of the units with my floor plan went down to what I paid.
This was an honest appraiser. Probably the only one in Florida.
Here is an appraiser who has said NO MORE!
http://www.bakersfieldbubble.blogspot.com/
Does it not strike you all that we are getting played?
There are scores of web sites similar to this one all tracking the housing collapse, the rise of China, the devaluing of the U.S. dollar, economic collapse of the U.S. along with semi-conspiratorial explanations of how it has come to be (e.g., the creature from Jekyll Island). Then there's peak oil and climate warming.
For the end of a great power and perhaps civilization, this has got to be the most watched and documented unwinding ever.
If we're going to get conspiratorial, perhaps we are simply being prepared for what is to come, providing less of a shock.
I can't say exactly but these are strange days.
Has anyone given any thought to the idea that the powers that be WANT the dollar to tank?
Why? It causes insipid inflation that will help float the house prices and prevent a crash, but the Fed can still look like a "hawk" on inflation and not lower rates. It helps to reduce the price of our goods and hence their attractiveness to European markets. Also, it helps to fight the Japanese and Chinese pegs of their currencies at artificially low levels against the dollar, though indirectly via the Euro and other intermediary currencies.
Interesting times indeed.
Or do I just misunderstand?
anonymous wimp said...
Has anyone given any thought to the idea that the powers that be WANT the dollar to tank?
Why? It causes insipid inflation that will help float the house prices and prevent a crash, but the Fed can still look like a "hawk" on inflation and not lower rates. It helps to reduce the price of our goods and hence their attractiveness to European markets. Also, it helps to fight the Japanese and Chinese pegs of their currencies at artificially low levels against the dollar, though indirectly via the Euro and other intermediary currencies.
Interesting times indeed.
Or do I just misunderstand?
********************
This is what I have been talking about. You are correct anonopussy.
anonymous wimp said...
Has anyone given any thought to the idea that the powers that be WANT the dollar to tank?
Why? It causes insipid inflation that will help float the house prices and prevent a crash, but the Fed can still look like a "hawk" on inflation and not lower rates. It helps to reduce the price of our goods and hence their attractiveness to European markets. Also, it helps to fight the Japanese and Chinese pegs of their currencies at artificially low levels against the dollar, though indirectly via the Euro and other intermediary currencies.
Interesting times indeed.
Or do I just misunderstand?
****************
That is what I have been talking about anonopussy! The Amero commeth.
Selling foreclosed properties will
become an art for the Unrealtors®.
This "minor" scam might become very
common in the bubble afterburn:
www.techohio.com/rmic
There are two classes of attorneys
who are central to the housing crash:
Those who participated in closings;
and those to be in the bubble of
bubble litigation.
There is a shadow over any attorney
of any kind and time:
"The Referral System"
If they rub the wrong people in the
wrong way, they face a drop in case
referrals that are important to a
law practice.
This is particularly true if their
practice depends on local realtors
or local lenders, or if they take
a plaintiff's case against them,
or against another law firm.
This problems includes court staff attorneys and judges that plan to practice locally (to finally make some money).
So remember this in choosing and
working with an attorney. You can't
give them a free hand; you must get
copies of everything and understand
what is going on. You can secretly have a second attorney review the
work if you specify secrecy in that
fee agreement.
You have a right to use a law
library that has a "government
repository" function, which
includes those at most law schools.
I ain't rocket science, but it
takes time, time, and time.
Our legal system is great on paper,
but we don't live on paper; rather
something like a legal cesspool.
buy my professional appraisal , none of the houses are worth more than 125,000, anywhere, anyplace and a property tax that pays the shitties in my local government ripoffs parade, including the road pavers, that make it easier for the vulture hoards to steal tomatoes, or oranges and forment bigger government, even in the crash is to much at 300 bucks
so long as they get cost of living increases from tax dollars that include the rise in inflation and taxes, almost trrasonous to the people, yet not the state, of which they and only they are protected from
Real estate appraisal was deliberately designed to facilitate the real estate industry's misdeeds. There is virtually no enforcement by the state agencies, while appraisers do as they please. Ask any broker and he'll tell you, "Appraisers work for us". Appraisers being hired directly by brokers is no accident.
Look at who dominates the appraisal boards...the real estate and banking industries. Little reforms far out in the future are a red flag that appraisers are the real estate industry's scribes.
Read "The Truth About Real Estate Appraisal" by S. Bishop. Real estate appraisal is crooked from top to bottom.
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