Readers, I understand Wells Fargo is under litigation, as well. More coming. Rachel
A group of Washington homeowners has filed a lawsuit against Countrywide, claiming the mortgage giant illegally rigged the appraisal process at the expense of homeowners and independent appraisers.
The suit was filed Jan. 12 in U.S. District Court in Seattle.
It claims Countrywide forced homeowners to use a subsidiary called LandSafe for appraisals. The company then subcontracted the work to independent appraisers while charging homeowners as much as 200 percent of the actual cost of the appraisal, according to the claim.
Countrywide is a subsidiary of Bank of America. Shirley Norton, a Bank of America spokeswoman, said the company had not yet been served with the lawsuit, but she believes it has no merit based on what she has read.
The suit also contends that if independent appraisers did not accept Countrywide’s fee structure or appraisal guidelines, they risked being blacklisted for further work.
According to a statement from the Seattle-based law firm Hagens Berman Sobol Shapiro, LandSafe contracted appraisal work to a network of independent appraisers, but offered them rates as low as $140 each. The company then marked the costs of an appraisal as high as $410, the amount it billed the homeowner.
The suit claims Countrywide and LandSafe had too much influence on the appraisal process, which was designed to be independent.
“When you control the entire appraisal process, including your hands around the necks of appraisers, financially speaking, you have a lot of influence,” attorney Steve Berman said.
Berman alleges that hundreds of thousands of homeowners have been effected during the housing boom.
More information on the suit is at www.hbsslaw.com/CFChomeowners.
Rachel Pritchett
