Reverse Mortgage Fraud Alert: Appraisal Fraud Up 37% On HECM Loans

Reverse Mortgage Fraud Is On The Rise As HECM Loans See 37% Spike In Appraisal Fraud

Reverse Mortgage FraudThe Federal Housing Administration announced it has launched an investigation into reverse mortgage fraud. FHA has seen a spike of 37% in fraudulent appraisals on reverse mortgage loans.
Therefore, the agency announced that it will require a second appraisal on select HECM loans. The new guideline went into effect immediately.
The FHA stated that 50,000 of the 134,000 appraisals inputted into its automated valuation model were inaccurate by at least 3%. That is roughly 37$ of new submissions.
FHA Commissioner Brian Montgomery said:

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