I work with a Seattle-based law firm that is investigating Washington Mutual and First American Corporation based on complaints the companies have conspired to artificially inflate housing appraisals.

As I am sure you are all well aware the appraisal of a home is important when determining the loan you will receive, including monthly payments, APR and more. If these prices were artificially inflated to benefit WaMu and First American it could mean you have overpaid for your home and subsequently have an inflated mortgage.

This could also cause problems if you ever fall behind on your loan—another lender isn’t going to accept the inflated value of your home–meaning you can’t refinance.

If you have a home loan from Washington Mutual you can learn more about this investigation by visiting http://www.hbsslaw.com/wm.htm.

First order of business thanks for the near heart failure on the “car commercial ghost story” I fell hook-line-sinker for that one.

I was a loan officer in the early ’90’s in the Wash D.C. area and my experience with appraisals was similar to this story.

In our little shop of 12, we had a guy we called “The Lock.” We called him the lock because when we needed more room to make a deal happen this guy would come in higher than anyone else on his appraisals.

We also called him the lock because we knew when we had him we could go out and lock in the rate. Back in DC in those days you had to have a real estate attorney to complete a transaction.

Consequently this extra step slowed deals down making a minimum lock time 45 Day and the norm 60 days!

Everyone in our shop knew this guy’s appraisals were off but we still used him.

Why isn’t WAMU liable for some of the heat? Without a doubt these loan officers and their management knew that the appraisals were too high. Why give the lender a walk on this stuff?

Dean