v wrote:

On Thu, 14 Apr 2005 00:53:20 -0400, someone wrote:

Your suspicions are probably correct. Bankrate.com told of a similar story
a few weeks ago where the bank lowballed the appraisal to attempt to get
out of the loan.
http://www.bankrate.com/brm/story_co...9&prodtype=mtg
???? Don't believe everything you read on the internet.

It would help if you read the article cited first.

"Banks" do not do generally appraisals.

No they don't. They can however choose whose appraisal they care to work with.

It is a regulatory requirement in most situations that they use independent,
licensed appraisers. Yes there is pressure on them to me the number - BUT -
when I was doingn these,
I NEVER EVER had a bank try to get me to LOWER the answer. At times a
loan officer (who would get compensated for originating loans) would
call me to bitch and moan about how if it was only a few thousand
HIGHER, then the deal would work.

It does happen, particularly when interest rates suddenly rise, and the lender
decided not to or didn't bother to lock. Notice in the case cited, the bank's
appraiser's appraisal suddenly was lower than the original appraisal, 2 others,
and comps.



In business, perhaps one should never say "never", but I am very
skeptical of claims that a "bank lowballed an appraisal".

Banks refunding non-refundable fees doesn't happen every day either, and here
they had motivation to do so.

Like I
said, typically "banks" do not do appraisals in the first place, and
(especially for this to be news) it must be very uncommon, as the
industry economic forces generally lean the other way.

Not when interest rates are rising, e.g. as they did from Feb to March, and the
end lender doesn't want to keep the agreed interest rate. This happens all the
time when the lender didn't get a lock committment, and they know they are in
trouble if they previously claimed they did.