Two articles of note on the role of appraisals in the mortgage crisis. The first articlefeatures clients of mine who, sadly, lost their home. The lender, Ameriquest, is now out of business. Good riddance.
I am cynical about steps the government takes to address problems in Industry; I view Uncle Sam’s cures to be too often symbolic and meddlesome. In this case however, Coumo deserves credit in my view.
Mortgages are, essentially, collateralized loans. The valuation of the collateral (the home) is utterly crucial, especially when the loans are highly leveraged, made to the credit-challenged, or both. Since bad appraisals contributed to the current crisis and the industry has proved twice in 20 years that it cannot regulate itself, I have to grudgingly admit that the government has to step in. What a shame!