American Home Mortgage Acceptance, Inc. filed a civil lawsuit in the Southern District of Texas, Houston Division, against Alltex Lending Services, LLC, My House Mortgage, LLC and Diane Bell.
According to the complaint, Alltex, under the trade name Alltex Realty Services, is engaged in the business of appraising residential properties. Bell performed appraisals as an employee or independent contractor of Alltex.
According to the complaint, in July 2004, American Home made a loan of $380,000 secured by a mortgage on property located at 5150 Hidalgo Street, Unit 1902, Houston, Texas. Alltex and Bell provided an appraisal estimating the market value of the property at $441,000. The appraisal grossly overestimated the property value, according to the complaint, and utilized inappropriate comparables, made inappropriate adjustments to comparables and inaccurately described and inflated the sale price of a comparable property in the same building as the subject property. The loan amount thus exceeded the fair market value of the property and the borrower defaulted on the loan, resulting in damages to American Home of $166,612.26.
Pursuant to its brokerage agreement with American Home, My House represnted and warranted the completeness and accuracy of the property appraisal and agreed to indemnify American Home from losses associated with submission of inaccurate information contained within appraisals.
The complaint alleges a cause of action for negligence as to Alltex and Bell and a cause of action for breach of contract as to My House.


Rachel Dollar, the editor of Mortgage Fraud Blog is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors.