Stress on Bay Area Mortgage Brokers in the news: Appraisal Skimming

In short the article below outlines more stress that is put on Bay Area Mortgage Brokers. It seems that our mortgage banks put tighter and tighter restrictions on us the Mortgage Brokers daily. It is interesting though that the retail lenders are gouging clients and still “Countrywide” trying to increase their bottom line. Clients should be free to choose who they use to appraise there property since they pay for the cost.

See Below…

Countrywide, Wells Fargo under Investigation for Appraisal Skimming

Countrywide has been served a class-action lawsuit for allegedly forcing borrowers to use its subsidiary, LandSafe, for appraisals. The lawsuit claims that LandSafe subcontracted much of its appraisals to a network of independent appraisers offering them rates as low as $140 per assignment and then invoiced homeowners as high as $410. The suit also contends that independent appraisers who do not accept Countrywide’s fee structure or appraisal guidelines risked being blacklisted.

Filed in the U.S. District Court in Seattle, Wash., under the Racketeering Influenced and Corrupt Organizations Act, the suit seeks to represent the state’s homeowners who purchased or refinanced their home through Countrywide and LandSafe. According to the law firm, hundreds of thousands of homeowners may have fallen prey to the alleged scheme. “As we investigated Countrywide for our clients, it was immediately obvious that Countrywide is a well-oiled operation,” said Steve Berman, managing partner and lead attorney at Hagens Berman Sobol Shapiro. “Unfortunately, the company’s efficiencies are focused on soaking every penny from consumers and independent appraisers in ways we believe violate the law.”

In a similar case, Hagens Berman is investigating Wells Fargo and its appraisal subsidiary. Based on reports, Wells Fargo forces borrowers to use its appraisal firm, Rels Valuation, which then subcontracts the work to independent appraisers while charging homeowners inflated fees. “The real estate industry and lending practices in this country put homeowners at the mercy of companies like Well Fargo and others controlling the marketplace,” said Berman. The firm is investigating additional claims against Wells Fargo, including blacklisting appraisers who do not agree with the lender’s fee structure.

Subscribe to our daily mortgage market emails.

Have a Question?

Legal Disclaimer
Or give us a call