Will Fannie Mae and Freddy Mac Smack Down Banks?

Will the Washington Mutual Mortgage Scandal Impact You?

New York State Governor, Elliott Spritzer (pictured left) is expanding his questions into an alleged mortgage appraisal scandal between Washington Mutual (one of America's biggest banks) and appraisal company, 'eAppraiseIT'.

Governor Spritzer stated, "our expanding investigation into the mortgage industry has uncovered that Washington Mutual improperly pressured appraisers to provide inflated values that best served the lender's interest,"

What the Governor is saying is that Washington Mutual screwed over a bunch of people to make more money for themselves. The claims that the mortgage company gave false appraisals on homes.

The problem, from a down to earth point of view is, if a bank tells you that your home is worth more than the fair market value, you will have trouble when you try to sell it or refinance it.

I remember talking to a few of my friends a while back. They were all trying to convince me to buy a new home. They knew I had the money and the credit. They were all telling me about how they purchased their home in 2004 and only after a year, their home was appraised at double it's value.

I always was a little suspicious about their claims as well as the market. These were honest people whom I felt had been mislead into believing that their homes were worth more than they were. As it turns out, I was right in not believing the hype.

I've never trusted banks (for many reasons). This scandal gives me more reason to not deal with banks ever again.

Of course Freddie Mac and Fannie Mae promised to investigate. I'll keep you posted.

In the meantime, here are my suggestions for home owners:

1. Call your realtor and demand that they send you a full accounting of how your mortgage was appraised. Ask was that company independent or are was that company a vendor of the Realtor.

2. Call the bank that owns your mortgage and request a complete history. Include in your request:

A. A request for complete payment history

B. What 'other fees' (administrative, customer service etc.) were you billed for.

C. The current balance on your mortgage.

Keep all records of request and communication with your lender. If they don't respond to your satisfaction they may have something to hide.

What do you think? Share your comment's regarding any post you see here. Or if you have specific debt related or media inquires contact jcarltonford@yahoo.com