In the following press release issued on June 7, 2007, Ohio Attorney General Marc Dann announced the first big sweep of lawsuits targeting unscrupulous mortgage brokers and lenders since the state’s new predatory lending law took effect, and he has lodged complaints against ten companies for violating Ohio’s consumer protection laws.

In an effort to protect Ohio consumers and crack down on mortgage brokers, lenders, and other entities involved in arranging mortgage loans, multiple lawsuits have been filed in four Ohio counties against ten companies for undue influence on an appraiser. The complaints state that these companies have committed unconscionable acts or practices in violation of the Consumer Sales Practices Act by knowingly compensating, instructing, inducing, coercing, or intimidating appraisers for the purpose of improperly influencing the independent process.

Appraisal inflation occurs when the the appraisal value of a home is far higher than the true market value of the property. This can happen when the broker or lender pressure the appraiser to “puff up” a property value based upon the desired loan amount, or the figure needed to “make the deal work” as opposed to the actual value of the property to be purchased or refinanced.

This undue influence results in the consumer owing more money on their mortgage than their house is actually worth, which prevents the consumer from refinancing the house when their loan interest rate increases or mortgage rates drop. The homeowner is then trapped in a loan they cannot refinance and a house with a sale value less than the outstanding balance of the loan.

Ohio Attorney General Marc Dann believes such corrupt appraisals are one of the core components of predatory lending, which ultimately can lead to foreclosure.

“Predatory lending is driving Ohio’s shameful home foreclosure rate. Today’s crackdown on appraisal fraud will help protect consumers and move us one step closer to driving unscrupulous lenders out of our communities,” said Ohio Attorney General Marc Dann.

Mr. Dann went on to say, “I’m committed to ridding this state of appraisal inflation and other symptoms of mortgage fraud that has ripped families apart and led to an unprecedented number of foreclosures in this state. I won’t allow this unethical exertion of power over appraisers who face this choice of doing the right thing or losing business entirely to continue.”

In the suits, Attorney General Dann is asking the courts for a declaratory judgment stating that each act alleged in the complaint is a violation of the Consumer Sales Practices Act and a permanent injunction from engaging in the alleged behavior. Dann is also asking these firms be fined a civil penalty of twenty-five thousand dollars each and is requesting an order to reimburse all consumers who were damaged by the Defendant’s unfair, deceptive, and unconscionable acts.

Attorney General Dann is also asking the courts to order the lender to maintain all business records related to transactions in Ohio for a period of five years.

• Complete List Of Targets
• Ace Mortgage Funding, LLC
• Premiere Service Mortgage
• Island Financial, LLC
• Sage Credit Company, LLC
• Wall Street Mortgage Bankers
• All Line Appraisals
• Apex Mortgage Services, LLC
• American Home Brokerage, CORP.
• Robert C. Roach, The Valley Mortgage Group
• First Ohio Banc & Lending, INC.