Update from Shane Lanham

[djd09]

Reed Colfax, didn't some appraisal organization give them money? Was it TAF or appraisal institute? I remember when the leader of the appraisal institute claimed an appraiser was racist based on an appraisal report he never even saw, this was Craig Steinly. Anyone sending money to AI is sending money against appraisers, at least residential ones.

colfax...is he on the board of trustees of TAF

 

[djd09]

but just to make sure i understand...TAF paid Relman Colfax $570,031...and Relman Colfax were the legal reps for the johns hopkins couple?

 

[djd09]

Judge allows appraisal bias lawsuit against Rocket to proceed​

Rocket contends they offered the homeowner a path to challenge the appraisal

A Colorado federal judge has allowed an appraisal bias lawsuit against Rocket Mortgage to move forward, denying the company’s motion to dismiss.

The U.S. Department of Justice — following a move made by the U.S. Department of Housing and Urban Development (HUD) — filed the case in October 2024 against the lender, appraiser Maksym Mykhailyna and his company, Maverick Appraisal Group, as well as appraisal management company Solidifi U.S. Inc. Rocket later sued HUD, arguing the agency “unfairly” held it accountable.

DOJ alleges that the defendants undervalued a Black homeowner’s property based on her race in an appraisal made in 2021 in Denver. In addition, Rocket is accused of retaliating against the homeowner by canceling her refinance application when she reported the discrimination.

In a statement, a spokesperson for the lender wrote, “Despite the judge’s ruling, Rocket Mortgage remains steadfast that it did not discriminate in any way.”

U.S. Judge Gordon P. Gallagher ruled Friday that Rocket’s motion to dismiss failed to address key theories of liability. While the company argued it was barred by law from changing the appraisal, Gallagher said regulations permit lenders to obtain additional valuations of a borrower’s property.

Judge Gallagher stated, “Nowhere in its motions or replies does Rocket address its alleged ability to order a separate appraisal or explain its failure to do so even after receiving Cheroutes’s complaint about racial discrimination.”

The judge concludes that Rocket did not address plainly alleged theories of liability.

The judge also rejected Solidifi’s argument that Mykhailyna’s role as an independent contractor shielded the company, noting that federal law recognizes independent contractors can still be considered agents.

“Even though Colorado’s legal restrictions preserve appraiser discretion, they do not limit Solidifi’s control in a manner or to an extent relevant here. The applicable federal regulation is similar,” Gallagher said.

According to the DOJ, Mykhailyna relied on sales from predominantly Black neighborhoods farther from the subject property while ignoring closer comparable sales. His valuation came in more than $200,000 below a prior appraisal, despite Denver home prices rising 25% during that time. After the homeowner complained to Rocket Mortgage, the company canceled her refinance application, she alleges.

According to the Rocket spokesperson, the DOJ “dragged” the firm into a lawsuit based on the assertion that it had the authority to correct the allegedly discriminatory appraisal but failed to do so, which is “100% false” as a matter of law.

“It’s also important to note that Rocket Mortgage offered the homeowner a path to challenge the appraisal through a value reconsideration process, which complies with the law, but she declined to engage in that process on two separate occasions,” the spokesperson added. “Rocket Mortgage looks forward to explaining its position in court and fully expects to the vindicated in this case.”

Judge allows appraisal bias lawsuit against Rocket to proceed

A Colorado federal judge has allowed an appraisal bias lawsuit against Rocket Mortgage to move forward, denying company's motion to dismiss.

www.housingwire.com

that is what i always said...order a second appraisal you cheapsters

 

[Fernando]

Judge allows appraisal bias lawsuit against Rocket to proceed​

Rocket contends they offered the homeowner a path to challenge the appraisal

A Colorado federal judge has allowed an appraisal bias lawsuit against Rocket Mortgage to move forward, denying the company’s motion to dismiss.

The U.S. Department of Justice — following a move made by the U.S. Department of Housing and Urban Development (HUD) — filed the case in October 2024 against the lender, appraiser Maksym Mykhailyna and his company, Maverick Appraisal Group, as well as appraisal management company Solidifi U.S. Inc. Rocket later sued HUD, arguing the agency “unfairly” held it accountable.

DOJ alleges that the defendants undervalued a Black homeowner’s property based on her race in an appraisal made in 2021 in Denver. In addition, Rocket is accused of retaliating against the homeowner by canceling her refinance application when she reported the discrimination.

In a statement, a spokesperson for the lender wrote, “Despite the judge’s ruling, Rocket Mortgage remains steadfast that it did not discriminate in any way.”

U.S. Judge Gordon P. Gallagher ruled Friday that Rocket’s motion to dismiss failed to address key theories of liability. While the company argued it was barred by law from changing the appraisal, Gallagher said regulations permit lenders to obtain additional valuations of a borrower’s property.

Judge Gallagher stated, “Nowhere in its motions or replies does Rocket address its alleged ability to order a separate appraisal or explain its failure to do so even after receiving Cheroutes’s complaint about racial discrimination.”

The judge concludes that Rocket did not address plainly alleged theories of liability.

The judge also rejected Solidifi’s argument that Mykhailyna’s role as an independent contractor shielded the company, noting that federal law recognizes independent contractors can still be considered agents.

“Even though Colorado’s legal restrictions preserve appraiser discretion, they do not limit Solidifi’s control in a manner or to an extent relevant here. The applicable federal regulation is similar,” Gallagher said.

According to the DOJ, Mykhailyna relied on sales from predominantly Black neighborhoods farther from the subject property while ignoring closer comparable sales. His valuation came in more than $200,000 below a prior appraisal, despite Denver home prices rising 25% during that time. After the homeowner complained to Rocket Mortgage, the company canceled her refinance application, she alleges.

According to the Rocket spokesperson, the DOJ “dragged” the firm into a lawsuit based on the assertion that it had the authority to correct the allegedly discriminatory appraisal but failed to do so, which is “100% false” as a matter of law.

“It’s also important to note that Rocket Mortgage offered the homeowner a path to challenge the appraisal through a value reconsideration process, which complies with the law, but she declined to engage in that process on two separate occasions,” the spokesperson added. “Rocket Mortgage looks forward to explaining its position in court and fully expects to the vindicated in this case.”

Judge allows appraisal bias lawsuit against Rocket to proceed

A Colorado federal judge has allowed an appraisal bias lawsuit against Rocket Mortgage to move forward, denying company's motion to dismiss.

www.housingwire.com

that is what i always said...order a second appraisal you cheapsters

Now AMCs and Lenders should realize that they will have to take more responsibility in the appraisers they choose to do appraisers for them.
Or at least have competent reviewers to vet the reliability of the appraisal reports.

 

[Dublin ohio]

Or at least have competent reviewers to vet the reliability of the appraisal reports.

No reviewer is going to go into a review looking for racial bias. They may disagree with the sales used. But are not going to consider the race of the buyer of those sales in their analysis.

 

[Fernando]

No reviewer is going to go into a review looking for racial bias. They may disagree with the sales used. But are not going to consider the race of the buyer of those sales in their analysis.

Reviewers should have seen the comps chosen were not appropriate.
Blame it on USPAP allowing reviewers need not be competent in approving appraisals outside their geographical knowledge.

 

[Dublin ohio]

Reviewers should have seen the comps chosen were not appropriate.
Blame it on USPAP allowing reviewers need not be competent in approving appraisals outside their geographical knowledge.

90% of AMC "reviewers" are checkbox monkeys. Not real reviewers. Geographical knowledge is not a requirement

 

[Fernando]

90% of AMC "reviewers" are checkbox monkeys. Not real reviewers. Geographical knowledge is not a requirement

I noticed that in past decade that is especially before UAD, the reviewers were better in picking appraisal mistakes in my reports than checkbox "guidelines".
Now as long as I fit their "guidelines", my appraisal value should not be questioned. It's easier now.

 

[djd09]

New analysis finds evidence of racial bias in Philadelphia home appraisals​

Federal data shows that racial bias remains a potential roadblock for homebuyers and homeowners in Philadelphia’s predominantly Black neighborhoods, according to new research from the Reinvestment Fund.

The report, released Thursday, focuses on home appraisals. It found that independent valuations completed in those communities were more likely to be lower than the property’s market value, making it harder for buyers to secure mortgage loans, as well as for homeowners to pull equity out of their properties.

“This is not just saying that properties in Black neighborhoods are less valuable than the properties in white neighborhoods,” said Ira Goldstein, senior advisor of policy solutions at the Reinvestment Fund. “It implies that there is some measure of bias in either the individual appraisals, or in some of the appraisal methodology, or a variety of other settings.”


Home appraisals, which are largely carried out by white men, are a crucial component of the mortgage-lending process. Lenders use those valuations to secure loans, whether it’s a first-time buyer or a homeowner looking to refinance to help cover another expense, such as medical bills or college tuition for their children.

Racial bias still a problem for Philly homeowners and homebuyers, new report finds

Researchers analyzed valuations completed for home purchases and applications to refinance.

whyy.org

...
​

 

[sputnam]

New analysis finds evidence of racial bias in Philadelphia home appraisals​

Federal data shows that racial bias remains a potential roadblock for homebuyers and homeowners in Philadelphia’s predominantly Black neighborhoods, according to new research from the Reinvestment Fund.​

​

The report, released Thursday, focuses on home appraisals. It found that independent valuations completed in those communities were more likely to be lower than the property’s market value, making it harder for buyers to secure mortgage loans, as well as for homeowners to pull equity out of their properties.​

​

“This is not just saying that properties in Black neighborhoods are less valuable than the properties in white neighborhoods,” said Ira Goldstein, senior advisor of policy solutions at the Reinvestment Fund. “It implies that there is some measure of bias in either the individual appraisals, or in some of the appraisal methodology, or a variety of other settings.”​

​

​

Home appraisals, which are largely carried out by white men, are a crucial component of the mortgage-lending process. Lenders use those valuations to secure loans, whether it’s a first-time buyer or a homeowner looking to refinance to help cover another expense, such as medical bills or college tuition for their children.​

​

​

​

Racial bias still a problem for Philly homeowners and homebuyers, new report finds

Researchers analyzed valuations completed for home purchases and applications to refinance.

whyy.org

​

... ​

​

I've looked into a few of these 'studies'. In all of the ones I've looked at, the methodology is flawed and seems designed more to support a preconceived notion than it is to determine the reasons that some neighborhoods have lower home prices than other neighborhoods.

Appraisers do not set the values of the properties they appraise. Appraisers try to form an opinion of what that value is. Of course, since this is an appraiser's forum... I'm preaching to the choir. The fact is everyone is biased. In most cases, that bias is allowed. For example, I am biased against eggplant. No one cares. Are there individual appraisers who are racially biased? Sure. Are there individual appraisers who allow their bias to influence their opinion of value? Probably. Is appraiser bias a systemic problem. Very unlikely.