What Are You Facing If Charged With Appraisal Fraud
Appraisal fraud is a form of mortgage fraud where the appraisal is intentionally inaccurate instead of reflecting the true market value of the home. Appraisal fraud generally occurs when an appraiser is a part of the fraud scheme. However, homeowners,mortgage brokers or realtors could also participate in an appraisal fraud scheme by digitally editing or otherwise altering a legitimate appraisal.
Appraisal fraud can involve improperly obtaining funds from a bank. When a lending institution is defrauded, there is a significant risk that you could face federal charges that result in decades of imprisonment. Do not handle these cases on your own- there is too much at stake.
Contact a New York City criminal defense lawyer at Bukh Law Firm, PLLC for assistance with any mortgage fraud case if you need an aggressive, knowledgeable lawyer on your side to stand up for your rights.
What is Appraisal Fraud
An appraisal is supposed to be a legitimate assessment of the market value of the home. In some cases, however, an appraiser intentionally misstates what the home is worth.
- The appraiser could inflate the price and appraise the home for more than it is worth in order to help a seller get a price above market value; to help a homeowner refinance a property or secure a home equity loan; or to help a home buyer get a larger loan than he should based on the property’s value.
- An appraiser could participate in a builder bailout scheme , appraising a house for more than it is worth so a builder is able to refinance or renew a line of credit. Builder bailouts could involve a straw buyer “purchasing” a home from the builder at an inflated price, with a fraudulent appraisal, so the builder appears more profitable to the lender.
- An appraiser could also understate the value of the home. This occurs in short sale fraud and in real estate fraud offenses related to improper flipping of the home. The appraiser claims the house is worth less so it is sold at a low rate to a “buyer” who is participating in a mortgage fraud scheme. The bank takes a bigger loss on the short sale or the home seller takes a loss on the property. The home is then resold at a large profit, sometimes after a minimum of cosmetic improvements or with no improvements at all.
Appraisers must certify that their appraisals are accurate and based on generally accepted standards. An appraiser who participates in any fraud scheme can be charged with all underlying criminal offenses committed by co-conspirators. This means even if the appraiser does not apply for a fraudulent mortgage loan personally, he could still be charged with bank fraud or residential mortgage fraud if a co-conspirator who is part of the fraud scheme applies for a loan and improperly obtains funds.
Penalties for Appraisal Fraud
Appraisal fraud can result in the loss of a realtor license and in being barred from participation in future appraisals. A civil case can be brought to obtain money from the appraiser that was lost due to the fraudulent appraisals. The U.S. Department of Justice reported in 2012 about one New York appraiser who had to repay $250,000 because his firm overstated the value of properties that were alleged to be part of a mortgage fraud scheme.
In addition to civil penalties, there is the possibility of both state and federal criminal charges. A charge ofbank fraud under U.S. Code Section 1344 has a potential penalty of up to 30 years imprisonment and a $1 million fine. Postal and wire fraud are also federal criminal offenses that carry a 30 year penalty and a $1 million fine. New York State residential mortgage fraud is also charged as a felony in most situations, unless the amount at stake in the fraud is less than $1,000.
Getting Help with an Appraisal Fraud Charge
You need an experienced and dedicated appraisal fraud lawyer to help you fight criminal charges if you have been accused of fraud involving a real estate appraisal. Bukh Law Firm, PLLC can provide you with assistance negotiating with a prosecutor to secure a plea agreement or can help you fight conviction and secure a verdict of not guilty.
To learn more about how a New York City criminal lawyer can help, give us a call today.