Appraisal Fraud: Definition, Meaning, Red Flags of Appraisal Scam
Appraisal Fraud: What Should You Know?
Dear visitors of our blog, we have made up a new long-read guide to help you to be secured from scamming schemes in the field of mortgage scams. In our new article, we include the following information:
- The team and meaning of Home Appraisal Fraud;
- General types of such scams;
- Red Flags to spot the scheme before trapping into it;
- How to avoid this group of frauds:
- How to give a fightback scammers.
Home Appraisal Fraud: Definition And Meaning
Firstly, we should mention the term of such scam. Appraisal fraud is a type of mortgage fraud, where independently estimates the cost of a home at an increased price, which is more than its fair market value.
An appraisal scam can occur when an appraiser is on the fraud, and the property’s rate is dishonestly exaggerated. It may also happen when the homeowner, seller, representative, or customer materially modifies an “honest” evaluation using e-methods (photoshop) or bribery. Now, when you know what is appraisal fraud, we can move further to see the light!
Types of Appraisal Fraud: the Most Common Ones
The diversity of such scams can make you nervous. There are some basic types of fraud diversion:
- In connection to subject: seller, buyer, representative, homeowner, state official, a third party;
- In connection with the way obtaining of power: dishonest evaluation by one of the parties during negotiation, illegal usage of powers of state representatives, etc;
- In connection to the tool of breaking the law: bribing, deceiving buyers, using high powers, and pretending to make action hidden by the law.
Appraisal fraud cases can happen in different stages of buying/selling property. It is crucially important to define the subject, object, and tools implemented by a scammer.
Red Flags to Real Estate Appraisal Fraud: Spot to Avoid
- The appraisal is too costly or too cheap compared to the agreed-upon selling price in the market.
- One of the parties put pressure to get benefits illegally or with the application of unlawful means.
- The third-party that evaluates a property is hired by one party, and the other one is not given its permission or grant.
- This evaluator is not one from a state body or performs activities beyond his or her legal powers.
- Negotiations are rough, quick, and not following a legal procedure.
Spotting and following appraisal fraud alarms will help you to avoid such scams.
We recommend you to read related articles about frauds that are provided in the list below:
- Inheritance Scam: How to Spot & Avoid Various Fake Inheritance Documents
- Online Auction Frauds: Features And Check-list on How to Avoid Them
- What are mortgage frauds?
How to Avoid it?
Hire an appraiser on your own – you must pay for estimation when purchasing or refinancing a house anyway. It is well worth investing to know that the venture you are taking is lawful.
Ask for recommendations – It is wise to look for an appraiser that manages banks support rather than those who work for mortgage brokers. Banks are more interested to hire qualified and moral appraisers.
Go for an ethical appraiser – you should search and look for a specialist with high moral standards and a positive reputation until you find a good or the best candidate. It is not a piece-of-cake task to give the severity of the dilemma. Make research to be confident that your appraiser is state-certified.
What to Do When You Suspect Appraisal Fraud?
You should follow this link and make a report on this blog. Together with our partner we can help and restore justice. Also, you should look at Financial Regulatory Authorities by Country, or search about it on the Internet.
Thank you for your time and patience! Read the other articles as well! See you next time! Take care and be aware of trapping into scamming schemes.
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