Tuesday, January 11, 2005

Illinois Fines Residential Mortgage Licensee $5,000 for Lender Pressure

In what may be a first, a state regulatory agency has fined a lending company for pressuring appraisers to come up with a specified value. The Illinois Department of Financial and Professional Regulation - Division of Banks and Real Estate, fined Choice One Mortgage, Inc., an Illinois residential mortgage licensee, $5,000 for ordering “appraisals from an Illinois licensed appraiser with minimum value necessary to complete the loan.” In addition, the Department found that “appraisal orders were cancelled, not paid for, or otherwise negatively treated when the accepted minimum value was not provided.”

It was determined that Choice One violated its original license application and renewals that state “it will not make payment to an in-house or fee appraiser for the purpose of influencing the independent judgment of the appraiser with respect to the value of any real estate covered by the home mortgage” and violated the federal Uniform Standards of Professional Appraisal Practice by “financing a residential mortgage transaction based on inaccurate property valuation.”

For more information on the violation, visit the IDFPR Web site at

www.obre.state.il.us/RESFIN/Discipline/2004BRF-77-Order5067.pdf

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