I got a phone message from a loan officer at ‘Great Big National Lender’ yesterday, a very familiar company you’d all know the name of. The loan officer wanted me to “check the value” on a property and if it did not reach a certain level they would not initiate a loan.
For those of you that don’t know it, it is illegal to do such a thing. In the first place, I don’t know any more about the property than the loan officer does at this point. In the second place, to do what the loan officer asked IS AN APPRAISAL. To do such an appraisal legally there must be an auditable file to support the verbal report to the loan officer. And, thirdly, Fannie Mae frowns on that kind of activity quite harshly.
I called the lender to see what their policy was. They not only forbid such behavior, they have a team set up nationally to monitor and discourage such activity.
There was a time when such illegal activity was ignored by most lenders. Some have always supported appraiser independence. Without appraiser independence from the influence of loan officers the appraisals often become biased to the result the loan officer is looking for regardless of what the actual market value of the property might be.
Pacific West Appraisal Services, Inc.
pwas.net