When I bought my last home, I had it independently appraised prior to putting in an offer. That appraisal ended up being used by the bank (not the one currently involved in this story) as proof of value for the home. It struck me as odd that they relied/accepted my documentation without any question....it would have been soooo easy to overstate the value by 20, 30, 40 thousand.
All in all, I'm not surprised somebody figured out how to abuse the banks' apathy in order to make money. Not that they should, but I'm not surprised.....
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