Thursday, November 01, 2007

Color Us Shocked

The bigger the loan, the bigger the profit? You don't say. AP (11.01.07):
"New York Attorney General Andrew Cuomo said Thursday a major real estate appraisal company colluded with the nation's largest savings and loan companies to inflate the values of homes, contributing to the subprime mortgage crisis.

'This is a case we believe is indicative of an industry-wide problem,' Cuomo said in a news conference."

Cuomo: appraisers pressured to inflate subprime mortgage values

"Cuomo announced a lawsuit against eAppraiseIT that accuses the First American Corp. subsidiary of caving in to pressure from Washington Mutual to use a list of 'proven appraisers' who he claims inflated home appraisals."

ABCNews (11.01.07), via Eschaton:

"According to civil court papers filed in New York City, at least 50 e-mails between executives from the mortgage and property services conglomerate, First American Corporation, its wholly owned subsidiary, eAppraiseIT, and Washington Mutual document a 'raise the value' scheme."

N.Y. Attorney General: Leading Bank Profits at Homeowners' Expense

And guess what? Consumers are finding that when "they attempt to sell or refinance their property, they might owe more in loans than the property is actually worth."



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