Real estate appraisals and mortgages are a key part of the housing market, allowing homeowners to receive financing to obtain their dream home. However, both appraisals and mortgages can be manipulated through fraudulent practices, with devastating consequences to both buyers and sellers. Victims of appraisal and mortgage fraud may be entitled to receive compensation with the help of a qualified real estate attorney. Our brief guide to appraisal and mortgage guide will help you understand these types of fraud and learn how to protect yourself and your home from fraudulent real estate practices.
What is appraisal and mortgage fraud?
Appraisal fraud is one of the most common types of mortgage fraud. It occurs when an appraiser or other professional deliberately inflates the appraisal value of a home in order for one party to obtain a mortgage loan. Professional real estate appraisers are regulated and held to a very high standard. Like all professions, however, there can be “bad apples.”
Overstating the value of the home can have several effects: the buyer may overpay for the home based on a false representation of its true worth, the buyer may take out a mortgage loan that exceeds what is needed for the true value of the home, or the homeowner may be able to refinance or obtain a home equity loan for which they may have not otherwise qualified. Appraisal and mortgage fraud can also be devastating for individuals facing foreclosure, as the falsified appraisal amount can greatly increase the amount of money payable to prevent losing your home.
How can you protect yourself?
There are several ways that you can prevent being taken advantage of when your home is being appraised:
- Hire your own experienced real estate attorney to protect your interests;
- Hire your own appraiser for a second opinion. The lender’s appraiser will not be able to discuss that report with you without written authorization from the lender. Legitimate appraisers should be state-certified and able to provide references;
- Research the actual sale prices of homes in the area using the public site of the Sate Department of Assessments and Taxation, and compare it to the appraisal value you received, making allowances for any upgrades that would increase the value or serious problems that would decrease the worth of the home. Internet sites that claim to provide a value estimate have a very high error rate and should not be relied on.
Let ‘Maryland’s appraiser lawyer’ help you recover from appraisal and mortgage fraud
At the Law Office of Jack R. Sturgill, we are dedicated to providing top-notch representation to victims of appraisal and mortgage fraud. If you think you have been a victim of appraisal and mortgage fraud, our experienced real estate legal team can help you recover compensation for damages. To receive your consultation, please visit us online at www.jackslaw.com or contact our office at (410) 296-6485.