“A new national survey found that 90 percent of appraisers reported that mortgage brokers, realty agents, lenders and even consumers have pressured them to raise property valuations to enable deals to go through. That percentage is up sharply from a parallel survey conducted in 2003, when 55 percent of appraisers reported attempts to influence their findings and 45 percent reported “never.” Now the latter category is down to just 10 percent.” (Feeling pressure to inflate appraisals)
You Can Relist, But You Can’t Hide [SocketSite]

Recent Articles

Comments from “Plugged-In” Readers

  1. Posted by Anonymous

    Pressure to make values is a constant factor in the appraisal business and yes, it has become more intense recently as values escalated rapidly in the past few years and then more recently when borrowers have been hitting a credit crunch. If this is anything like past market cycles though, we are now at or just past the peak of easy money and lending and appraisal standards will tighten up as a result of increased foreclosure activity. In fact, that seems to be already happening with a tightening of standards for subprime borrowers with the high rate of foreclosures for these loans nationally. However, at the same time, one of the other things going on in the appraisal business is an all time high level of fraud caused mostly by a huge influx of minimally trained (and sometimes ethically challenged) residential appraisers who jumped into the field with the refinancing boom after the dot-com crash. They have recently enacted tougher standards to get your appraisal license but it will likely take a while to weed out the bad eggs. In the past decade, the rising market bailed out all but the most egregious appraisal and valuation screw-ups, but that may have not be the case for a while.

  2. Posted by Dude

    This has happened before. The S&L scandal, in part, was due to over-inflated appraisals.

  3. Posted by rg

    I’m so glad you’ve added this story, because I’ve been saying for years that appraisers are completely crazy and unethical with these prices. My mother was an appraiser, and the training didn’t have anything to do with a “boom” or the fact that unqualified people can secure a big mortgage or if the seller wanted to be a millioniare this week – it’s a very technical and mathematical calculation. Studs and drywall can only be worth so much.
    What is the recourse? These people should be fined and thrown in jail for escalating SF’s housing market this high. I want to start a lawsuit, on behalf of renters who can’t afford these prices, against them! Anyone want to join? Any lawyers out there willing to start it? Erin Brokovich, where are you?

Add a Comment

Your email address will not be published. Required fields are marked *