Mortgage company inflated an appraisal, not taking accountability. Any ethics or laws broke, i am so lost?

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am lost and felt like i have been lied too by my mortage company. In 04 we bought a townhome for 174k had 2 loans, 1 for 140k that is a ARM and other for 35k. august of 05 we were approached by Countrywide that has our 1st loan telling us we have a value of 220k and you have about 35k in usable equity. We had about 25k in medical debt for my kids hospital bill. They suggested to roll that in with my 35k second. The selling point was to clear those payments to get ready to refinance my 1st which is a ARM to a fixed plan. Now i am getting these rate hikes now have a 10percent on my first and the payments are killing us. I went to countrywide to refinance, check my credit was 700, my income was fine. Then they send out a apparisal,came in at 185k, countrywide told me i cannot do anything. I hired my own appraiser came up with the samething, but he told me the property should have never been appraised at 220k when i took out the HELOC should have been 183k?
we live in a townhome community so all homes are alike. My appraiser that i hired showed me the sales during that time frame that countrywide showed a value of 220k. All the comparable sales were between the appraiser showed e Everytime i try to talk to them they just tell me too bad!

  1. Reply
    May 17, 2011 at 10:20 am

    Sounds like you need to consult a reputable banker and see who they use for an appraiser. Also, Countrywide is a non-reputable refinance company. Did you know that a refinance company adds AT LEAST $ 13,000 for their efforts?

  2. Reply
    May 26, 2011 at 3:10 pm

    On refinance transactions where the loan amount is less than the minimum for Federally Related Transactions ($250,000) the lender (Countrywide in your case) does not have to use an appraisal to determine value. Did you ever receive a copy of the appraisal? Or were you just told you qualified and your home was worth $220,000? My guess is that Countrywide used an AVM (computer generated value based on regression analysis) and not a real live appraiser to come to the $220,000 number. This was very common practice during the refinance boom, and resulted in many borrowers being instantly upside down in their homes.

    If an actual appraisal was done, by a licensed appraiser, you are entitled to a copy of the report and should review it, and have the appraiser you hired review it. If errors or misrepresentations are found you may have recourse against Countrywide for hiring a negligent appraiser. If you research this further you will find Countrywide is in a whole mess of litigation for these predatory lending practices and situation is similar to others that are in class action status.

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