AG Holds Mortgage Industry Accountable

admin —  December 7, 2009 — 10 Comments

Weststar Mortgage, Inc. was sued in an ongoing effort to hold the mortgage industry accountable for its part in the foreclosure crisis. The lawsuit charges the Washington D.C.-area company with improperly influencing Ohio appraisals.

According to the complaint filed in the Court of Common Pleas of Belmont County, Weststar violated Ohio law through a series of actions including using pre-printed “estimated value” forms for appraisals and shopping for a higher appraisal amount on behalf of clients.

In addition, three other companies accused of attempting to influence Ohio home appraisals have recently settled lawsuits with the state, resulting in a combined total of more than $150,000 in restitution and civil penalties.

In late November, Ohio Attorney General Richard Cordray settled with First Ohio Banc and Lending, headquartered in Independence, to resolve a lawsuit alleging the company engaged in unfair and deceptive home appraisal practices including deceptive advertising violations. In the agreed entry, First Ohio admitted that aspects of its advertising were deceptive and agreed to pay the state $52,400, which includes restitution to consumers.

In another agreement filed on Oct. 7, in the Franklin County Court of Common Pleas, Fiserv Lending Solutions, based in Connecticut agreed to pay $95,000 to the state, which is the largest undue influence settlement in Ohio to-date.

And finally, on September 22, Cordray entered into a similar agreement with Nations Lending, based in Middleburg Heights. In the settlement filed in Cuyahoga County Court of Common Pleas, Nations Lending agreed to pay the state $15,000 and will keep all appraisal records for three years. Those records are subject to review by the Attorney General.

Appraisal influence is a damaging practice that often goes undetected until it’s too late,” said Cordray. “With this case, we advance one more step in cleaning up the destructive actions that led to the foreclosure crisis.”

Consumers who fear their home’s value may have been misstated by an improperly influenced appraiser should file a complaint with Attorney General Cordray’s office at or (800) 282-0515.

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10 responses to AG Holds Mortgage Industry Accountable

  1. Michael McLaughlin September 29, 2010 at 3:37 pm

    I want to know if First Ohio Lending has a good reputation or not since I’m considering refinancing my home through them.

  2. Headline incorrect. Homeowners are not innocent victims. As a last minute action before losing a home or defaulting on credit cards. homeowners are always expecting the impossible. Eveyone believes after they make a major purchase that there homes are worth more and when its not, you hear it. Appraiser’s are victems to. No matter what value we give no one will be happy. As per the management companies they will bankrupt our economy and mortgage processing that goes with it. The real problem is the mortage brokers, Big Banks (yes them to, ever see a reconsideration of value form, BOA they do it all the time), BUILDERS WHO DO NOT HAVE VISION OTHER THEN JUST BUILD IT BECAUSE MY COST JUSTIFIES IT and the few scrupulous apprasiers who go with the flow and take and give from whatever and wherever they can get it. Once last thing what those idiots on TV

  3. The news is full of lender and AMC sanctions today. The Ohio AG went after 3 AMC’s – Fiserv, All Line Appraisals & Frontier Appraisals. Looks like Ohio is going after lenders, brokers and AMC’s. Will the appraisers be next? Also in the news today FHA shut down Lend America due to an extremely high default rate – almost 16%. Most of Lend America’s 600 employees were laid off.

  4. I agree that the title is misleading. But I am tired of all appraisers being depicted as being wimps who just can’t say “NO!.” I don’t care if you give me an estimated value or not. My research and methodology are going to be the same, and that’s whether you like the results or not, as far as the value is concerned. Pity the poor appraiser: he or she is being pressured. Do your job, don’t succumb, and have some self pride. And the reason the mortgage brokers or whoever are getting the greater publicity, is because they are making thousands of dollars. The idiot appraiser who participates is probably making $350 per job, if they are lucky. If anything, the appraiser should be tested for mental competence.

  5. I don’t believe Westar was an appraisal company-perhaps they had a staff of suckers, er…appraisers working for them but they’re a privately held residential mortgage banking company.

  6. Perhaps a case exists the headline is somewhat misleading, but there is a clear message here to appraisers not buckle to the pressure of mortgage companies or AMC’s. In addition, the first company listed (Westar Mortgage, Inc. ) is described as a Washington D.C. area “home appraisal company.”

    As for prosecuting mortgage brokers most often, it is because they were most often perpetrating the fraud. Unethical mortgage brokers proliferated in the peak of the re-fi boom. They often preyed on buyers with poor credit, extracted huge transaction fees and inflated appraisals to cover the deal. Some appraisers were willing accomplices, some others were pawns or dupes ensnared in the schemes.

  7. It seems to me that this article is titled incorrectly. It does not appear that it is the Appraisal Industry that is being held accountable, but rather several lenders who are unlawfully trying to influence the appraisal industry. Just a thought.

  8. Juno, I agree there’s plenty of blame to go around-I commented mostly because I thought the article title didn’t match its contents.

    Rest assured, appraisers are getting prosecuted. I know an expert witness who helps put them in prison. You will see more of this in the future because appraisers carry E & O insurance (most brokers that I know of do not) which looks very attractive to banks trying to mitigate their losses.

  9. Rita- With all due respect, appraisers were not innocent bystanders. As a matter of fact, the gang usually consists of a shady appraiser, mortgage broker, attorneys, shady buyer and sometimes even the seller.

    To me, it has conspiracy written all over it. Unfortunately, you do not see as many appraisers, buyers or sellers being prosecuted. You can see tonnes of mortgage brokers who were prosecuted. It is probably because they are the easiest ones to go after and the feds can make an example out of it.

    These are businesses with reputation in their local communities and fed can send a powerful message. I suppose they do not want to expire resources on some Joe Schmoe, who no has heard of and they may not be able to retrieve the losses or do not find as important.

    A crime is a crime, and a lot of times brokers end up paying for the crime they committed and also of the others in their gang.

  10. I don’t understand why you used the title you did for your article. It sounds to me like Mortgage Brokers’ companies are being held accountable for coercing appraisers. Appraisers are trying to earn a living in a broken system and it appears that the state is going after the bullies.

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