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Dodd Introduces Legislation to Protect American Homeownership

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Mystery man3

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Jul 26, 2005
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Certified Residential Appraiser
Go here to see what Dodd proposed:http://dodd.senate.gov/index.php?q=node/4167

Here is the part that has to do with appraisals:

Title IV – Good Faith and Fair Dealing In Appraisals
Requirements for Appraisers

Appraisers owe a duty of good faith and fair dealing to borrowers.
No lender may encourage or influence an appraiser to “hit” a certain value in connection with making a home loan. In addition, a lender may not seek to influence an appraisers work, nor select an appraiser on the basis of an expectation that he or she will appraise a property at a high enough value to facilitate a home loan.
A crucial cause of the current mortgage meltdown has been inflated appraisals. Many ethical appraisers complain that lenders will only use appraisers who consistently value properties at the levels necessary to allow the loan to close. Appraisers who do not cooperate simply do not get hired. This is particularly detrimental to the homeowner because it leads the homeowner to believe he or she has equity where little or none may exist.

Appraisers must obtain bonds equal to one percent of the value of the homes appraised.
Remedies available to borrowers

Lenders must adjust outstanding mortgages where appraisals exceeded true market value by 10 percent or more.
When an appraisal exceeds market value by 10 percent (plus or minus 2 percent) or more, a borrower has a cause of action against the lender. A consumer who is awarded remedies under this section shall collect from the appraiser’s bond.
Actual and statutory damages up to $5,000.
 

Ray Christ

Sophomore Member
Joined
Apr 17, 2002
Professional Status
Certified Residential Appraiser
State
Wisconsin
Why don't they just let the current laws and regulations do thier thing.The bond will drive most of us out of business. About the 10% of market value, i thought we set that so how do they know what the variance is.
 

Mystery man3

Thread Starter
Junior Member
Joined
Jul 26, 2005
Professional Status
Certified Residential Appraiser
Take Out A Personal Loan For The Bond

Do Whatever It Takes To Raise The Cash
 

Marcia Langley

Senior Member
Joined
Aug 26, 2005
Professional Status
Certified Residential Appraiser
State
Missouri
Jeffery,

Note the date of that proposal was last December. A lot of water has gone under the bridge since then.

For more up to date info, look at the Senate's main website and read up on the current bill being considered. As of last week, it did not have the bonding issue in it. Many other bills do but they are not up for votes right now.

Also search this forum for the word, "bonding" and you will find very recent discussions about the status of the various bills.

Don't forget that these bills are ammended daily. At any moment the bonding issue may be put back in or taken back out.
 

Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
A crucial cause of the current mortgage meltdown has been inflated appraisals.


FBI MORTGAGE FRAUD TASK FORCE JULY 2007 STATUS REPORT ON SARS FILED during first half 2007 stated, of actual LIVE investigated fraud cases, 86% had zero involvement by an Appraiser.

Crucial is as crucial does.
 

Mystery man3

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Junior Member
Joined
Jul 26, 2005
Professional Status
Certified Residential Appraiser
News

Can you post the new info. What I wanted with this post was news.
 
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