Banks and Appraisers Not Liable for Faulty Home Appraisals

, New York Law Journal

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Allison J. Schoenthal, a partner at Hogan Lovells US, writes: In the aftermath of the financial crisis, buyers are looking more closely at their failed investments and targeting banks and the property appraisers, claiming inflated or inaccurate appraisals, collusion between banks and the appraisers, and professional incompetence.

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What's being said

  • Allison Schoenthal‘s column in the April 17, 2014, NYLJ illustrates why both the bar and financial institutions deserve the low regard in which they are held by the general public. "The cost of the appraisal is often included in the buyer‘s closing costs and a copy of the appraisal is provided to the buyer before the closing." The cases which the writer cites and in which she represented the winning financial institutions or appraisers confirm how the system is stacked against the buyer. Most rational people would read the quoted sentence and conclude that when the bank forces the buyer to pay for the appraisal, the buyer rightly has an expectation that he or she will get what she paid for. We need a jurist of Cardozo‘s breadth of vision to expand the definition of privity as he did in McPherson v. Buick. And do we really need columns that are mere repetitions of the author‘s briefs for one side?

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