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from Local Attorney, Michael H. Wasserman

Monday, April 14, 2008

UPDATE: Mortgage Appraisers Regain some Indenpendence from the Mortgage Brokers that hire them

Back in February, I posted about an IRELA conference I attended in which two mortgage appraisers described the current market conditions from their vantage. They both expressed concern that Mortgage Brokers were demanding that appraisers find the "right" value for properties in order to get mortgage loans approved, and were threatening to stop doing business with those appraisers who would not "play ball"

On March 3, 2008, Fannie May, Freddie Mac, the NY Attorney General and the Office of Federal Housing Enterprise Oversight reached agreement to address this problem. Effective January 1, 2009, mortgage brokers will no longer be able to order "Made as Instructed" appraisals (requests for appraisals that contain instructions for a report to match the purchase price, or that have real or implied th
reats that continued business orders will only be made if the appraiser establishes a property's value "as instructed."

After December 31, only specially trained broker employees will be allowed to order appraisers and brokers will be prohibited from exerting any type of pressure on appraisers to influence their findings.