MSLP -- mortgage broker's suggested list price

It's one thing to hear that appraisers are pressured to inflate valuations (see Inman News story), and another to see how it's supposedly done.

The Ohio Attorney General has filed complaints against 10 companies, alleging they sent loaded appraisal requests to two appraisers. The appraisers seem to have gotten fed up and turned the requests over to the authorities.

A typical example of what got the appraisers -- and the Attorney General -- fired up:

A request for a "pre comp" from a loan agent gives the appraiser an "estimated value" of $300,000, and instructs: "If preliminary research shows that value is not there please DO NOT do appraisal and contact the agent."

According to the Attorney General, such requests are intended to coerce appraisers into going along with inflated valuations, which down the road lead to foreclosures (Ohio ranked third out of all states for total foreclosures in April). The implication is if they don't play along, they won't get the work -- now and forever.

One of the appraisers who forwarded the allegedly coercive valuation requests to Ohio authorities told Inman News that "pre comp" is "a word that's been concocted by mortgage brokers to indicate to the appraiser, 'I want you to tell me what this property is worth, but I don't want you to do any work, and I don't want to pay you,' " -- unless the "pre-comp" matches a pre-determined valuation (see story).

Click on "continue reading" to see examples of the appraisal requests that form the basis of the Attorney General's lawsuits.

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