Ineffective Appraisal Regulation: A Crack in the Foundation of the Home Mortgage Industry
Start Date
24-3-2010 2:05 PM
Description
Although inflated appraisals played a key role in each of the last two major national financial crises, regulators have been unable to ensure appraisal accuracy. As a result, self-interested loan transaction parties are able to coerce appraisers to inflate appraisal values for nothing more than the promise of future business. What's more, the complex and convoluted appraisal regulatory system is powerless to detect and prevent such inappropriate conduct. As Congress once again examines the financial industry and explores meaningful reform, it is imperative that self-interested parties be removed from the appraiser selection process and appraisal regulatory responsibilities be consolidated at the federal level.
Ineffective Appraisal Regulation: A Crack in the Foundation of the Home Mortgage Industry
Although inflated appraisals played a key role in each of the last two major national financial crises, regulators have been unable to ensure appraisal accuracy. As a result, self-interested loan transaction parties are able to coerce appraisers to inflate appraisal values for nothing more than the promise of future business. What's more, the complex and convoluted appraisal regulatory system is powerless to detect and prevent such inappropriate conduct. As Congress once again examines the financial industry and explores meaningful reform, it is imperative that self-interested parties be removed from the appraiser selection process and appraisal regulatory responsibilities be consolidated at the federal level.
