Washington Mutual

There is currently an investigation against Washington Mutual (WaMu) and First American Corporation in connection with home mortgages made by WaMu. The investigation concerns allegations that First American allowed WaMu to control appraisal values and apply pressure to appraisers to get housing value estimates raised in order to help close loans. Certain reports also allege that WaMu 'cherry picked,' which First American appraisers would appraise WaMu financial properties, based on which appraisers WaMu viewed would provide values high enough to permit WaMu's loans to close.

First American Corporation provides real estate appraisal services to savings and loans, banks and other lending professionals through First American eAppraiseIT, an appraisal management company. WaMu is First American's largest client.

On November 1, 2007, the Attorney General of New York filed a complaint making similar allegations.

If these allegations are correct, then homeowners would have obtained artificially inflated mortgages from WaMu and may have overpaid for their homes.

WaMu Appraisal Articles:

Washington Mutual Appraisals Investigated by the SEC
The Securities and Exchange Commission (SEC) is now investigating allegations about Washington Mutual's practice of inflating home appraisals. The SEC's investigation will look at whether WaMu accurately told investors how its loans were appraised and whether the company's loans were properly disclosed to investors.

Washington Mutual Faces Class Action Lawsuit
Washington Mutual faces a class action lawsuit alleging the company committed securities fraud by over-inflating home appraisals while also inflating prices. The lawsuit follows a complaint filed by the New York Attorney General's office that names Washington Mutual as pressuring other companies to provide inflated home appraisals.

WaMu: Shares Drop, Pressure Mounts Over Alleged Wrongdoing
It has been a week of tumult and turmoil for Washington Mutual and First American, since New York State Attorney General Andrew Cuomo initiated a lawsuit against First American and its real estate appraisal arm, eAppraiseIT alleging an illegal practice of inflating the values of homes to qualify for loans.

WaMu Inflated Valuations Hurt Consumers
Homeowners Angry at Washington Mutual's Appraisal Tactics

WaMu Appraisals In the News:

DEC-16-07: WaMu faces several lawsuits including shareholder lawsuits, breach of fiduciary duty lawsuits, and a suit against an appraisal firm alleging WaMu pushed the company into inflating appraisal values. [TIMES: WAMU]

NOV-16-07: In related news, a First American Corp. title insurance subsidiary agreed to a $5 million settlement to dismiss federal and state allegations that it gave kickbacks for new business. [CNN: APPRAISAL KICKBACKS]

NOV-07-07: Shares in Washington Mutual have dropped drastically after New York Attorney General Andrew Cuomo said he was expanding his investigation of house-price appraisals. [THE STREET: WAMU]

NOV-5-07: An investor lawsuit has been filed in New York against Washington Mutual alleging inflation of home appraisal values. [REUTERS: WAMU APPRAISALS]

NOV-2-07: New York Attorney General Andrew M. Cuomo is suing a unit of First American Corp. The suit contends it defrauded consumers by allowing Washington Mutual to inflate property values to ensure that loans went through. [WALL STREET JOURNAL: WASHINGTON MUTUAL]

WaMu Appraisal Legal Help

If your mortgage is with Washington Mutual, and if the appraisal was performed by First American, then you may have been damaged by this practice. If you are interested to participate in a potential lawsuit, or to learn more, please fill in our form on the right to send your complaint to a lawyer to evaluate your claim at no cost or obligation.
Last updated December 29 2007

Reader Comments

Posted by

July 28, 2016

After I tried in 2005 to Refinance with Washington Mutual, they sent me some paper work to do some sort of re-organization and I was denied anything I tried to do to save my home. From there, I had no choice and was forced to sell my home to a Buyer, just so I would not have Foreclosure on my record. My hopes where to buy my home back. I began paying rent to the buyer for a number of years. The Buyer ended up doing some shady business practices and from there, the home went to Foreclosure anyway. The Attorney Generals Office advised me that Breach of Contract might be involved and to file suit on behalf of that. I filed a lawsuit against all who were involved, representing myself. Washington Mutual, Blue View Corporation, New Solutions Real Estate LLC, and a few other names are in the Law Suit which later was dismissed without a reason. I am reminded to this day that I am no match to the GOLIATHS of this world. Don't know if you can help or not, however it is worth a try. Thanks for listening!

Posted by

I was told by Washington Mutual that with our approved forebearance that we would not have to make a payment for five months and that the payments would be moved to the end of the loan. After five months of not making a payment, Washington Mutual told us that we owed all of the money at once or we are in danger of foreclosure.

Posted by

We refinanced with a company named Flex Point who is out of business now. They sold our mortgage to Wamu.. Our house was overvalued and we were not aware that taxes were not included in payment. Due to loss of income and the fact that Wamu raised our mortgage to $4100.00 per month we are being foreclosed on. We have tried everything to save our home. The stress alone has been tremendous. If you could help us we would appreciate it.

Posted by

I lost my house due them lending me more money than they knew I could pay back.

Posted by

Purchased condo on March 16, 2007 at an appraised value of $300,000, the exact purchase offer price. Received a letter from WAMU, dated March 13, 2008 that HELOC was reduced from $29,000 to $10,400 due to declining market value. Requested copy of AMV and copy of original appraisal and, after almost 3 weeks of stalling and several inquiries, received a simple e-mailed letter stating only the new value of $259,490 (a 13% drop) with no supporting documentation. In the first 8 months, we lost $40,510 of our equity due to over valuation yet our taxed assessed value, partially based on our purchase price, increased by 83% during the same time period. We have excellent credit and put $60,000 down, but if we were forced to sell our home today, only 15 months after buying it, we would be upside down. We have lost a large chunk of our life savings.

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