GAO: Lenders requiring appraisals when none are needed

Lenders are obtaining appraisals in real estate transactions even when they are not required, the Government Accountability Office said in a new report.

In 2018 and 2019, lenders obtained appraisals for about 85% of the mortgages eligible for an exemption, the GAO said. The lenders could have required an evaluation—an estimate of a home’s market value not conducted by a state-approved appraiser.

For instance, GAO said, lenders typically obtained appraisals for mortgages of $250,000 or less, although they were permitted to use an evaluation.

There has been a well-documented shortage of certified appraisers in the United States. Realtors and others in the real estate business have said that shortage has led to significant delays in obtaining appraisals.

 

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