1. Welcome to AppraisersForum.com, the premiere online  community for the discussion of real estate appraisal. Register a free account to be able to post and unlock additional forums and features.

Fannie Mae Fraud Report- Put The Bullseye Where It Belongs

Discussion in 'Fannie Mae, Freddie Mac, USPAP' started by Mike Kennedy, Aug 31, 2009.

Thread Status:
Not open for further replies.
  1. Mike Kennedy

    Mike Kennedy Elite Member

    173
    Sep 28, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    New York
    Federal National Mortgage Association (Fannie Mae)
    As of December 2007, the top 10 markets (by zip code area) for mortgage loan misrepresentations according to Fannie Mae included Minneapolis, Minnesota; Atlanta, Georgia; Detroit, Michigan; Memphis, Tennessee; St. Paul, Minnesota; Pompano Beach, Florida; Miami, Florida; Fort Myers, Florida; Houston, Texas; and Dearborn, Michigan.22

    Fannie Mae is the nation’s largest mortgage investor. To aid in mortgage fraud prevention and detection, the company publishes a mortgage fraud newsletter that includes information concerning misrepresentations discovered in loan files. Loans originated in 2006 through 2007 and reviewed by Fannie Mae through December 2007 were used to formulate a geographic top 10 list by zip code area for concentrated mortgage loan misrepresentations (see figure 13).

    Figure 13: Fannie Mae Top 10 Zip Code Markets for Misrepresentations

    Rank for Number of MisrepresentationsTop 10 Zip Code Markets


    (first three digits of zip code)Type of Misrepresentation
    1​


    Minneapolis, Minnesota (554)
    Credit and SSN
    2
    Atlanta, Georgia (303)
    Credit and Income
    3
    Detroit, Michigan (482)
    Credit and Value/Property
    4
    Memphis, Tennessee (381)
    Income and Assets
    5
    St. Paul, Minnesota (551)
    Credit and SSN
    6
    Pompano Beach, Florida (330)
    Income and Credit
    7
    Miami, Florida (331)
    Income and Assets
    8
    Fort Myers, Florida (339)
    Credit and Occupancy
    9
    Houston, Texas (770)
    Income and Credit
    10
    Dearborn, Michigan (481)
    Credit and Income​



    SUGGEST COPYING AND EMAILING THE INFO ABOVE TO EVERY MEDIA REPORTER EACH TIME A NEW MISLEADING ARTICLE IS PUBLISHED PAINTING THE bulleye on the chests of Appraisers.



    http://www.fbi.gov/publications/fraud/mortgage_fraud07.htm
     
    Last edited: Aug 31, 2009
  2. DWiley

    DWiley Senior Member

    85
    Apr 4, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    Tennessee
    I have copies of several reports done by Mempis appraisers.

    Is it just me, or is regularly appraising propeties for twice what they are listed for (while not even disclosing that they are listed) an appraisal/appraiser problem? Just where should the bullseye go in such a case?
     
  3. Mike Kennedy

    Mike Kennedy Elite Member

    173
    Sep 28, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    New York
    Just where should the bullseye go in such a case?

    On the back of the prison stripes the former (a)ppraiser is issued. My personal and professional stance on Enforcement of existing Appraisal Standards (and laws in states which have them such as NY) is well known. Isolated incidents do not change the results reported by Fannie above which clearly illustrate the preponderence of investigated fraud cases (at least in 2006-2007) did NOT involve appraisals as a LEADING factor. Do they?
     
    Last edited: Aug 31, 2009
  4. Workbox

    Workbox Elite Member

    2
    Mar 2, 2005
    Professional Status:
    Certified Residential Appraiser
    State:
    Colorado
    Houston is on the list. Funny, during those time is when I started loosing most of my clients or I was too conservative.:rof:
     
  5. DWiley

    DWiley Senior Member

    85
    Apr 4, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    Tennessee
    I cannot speak to the other cities listed, but I can state for a fact that in Memphis the example I posted is NOT an isolated instance. Anyone wishing to verify that can call our state board and ask home many cases they have of fraudulent appraisal practice in Memphis.

    No entity or group is totally at fault for the current mess. Lenders certainly let greed blind them. But, as I have said in several other posts, appraisers need to step up an and admit that some of our own were indeed a significant part of the problem. Denying that makes us look less credible.
     
  6. Mike Kennedy

    Mike Kennedy Elite Member

    173
    Sep 28, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    New York
  7. DWiley

    DWiley Senior Member

    85
    Apr 4, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    Tennessee
    A lot of appraisers faced that. I am getting calls from companies that would not use our company in 2005-2007 who now want to hire us for forensic reviews.

    The irony is that those "cooperative" appraisers are now being turned in by the same lenders that wanted to use them in the past because they were a "team player." Those repurchase notices tend to change the lenders point of view.
    :)
     
  8. Scott Kibler

    Scott Kibler Elite Member
    Gold Supporting Member

    56
    Oct 7, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    Illinois
    Think many of those files with fake income docs also have a defective appraisal?
     
  9. Michael Tipton

    Michael Tipton Senior Member

    0
    Sep 25, 2005
    Professional Status:
    Certified Residential Appraiser
    State:
    Florida
    Your last statement is directly to the point, until lenders and their appraisal placement agents (amcs) are held accountable, no complaints were filed. The lenders and their agents place the appraisal orders.

    Wonder if and when any bankers will be fined for failing to utilize/demand USPAP compliant appraisal reports for FRTs? (I believe that is in the banking regs).
     
  10. Carnivore

    Carnivore Elite Member

    0
    Jan 15, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    North Carolina
    Plantation Theory and the Studeman Factor are what caused all the problems.

    Plantation Theory is in place to keep supply of appraisers high and pickin from can-see to cant-see.

    Studeman factor is sort of a Bossman who is a Slave to the actual Slave Master. His job paid well and enabled the Slave MAster to rake billions away from the homeowner.

    For those that dont know Studeman was a dude in NC who ran three sweat shops located in NC, FL and TN.

    He has been revoked by NC and FL, but last I checked the clown is still licensed and operating in TN.
     
Thread Status:
Not open for further replies.

Share This Page