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FOR IMMEDIATE RELEASE |
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State
Rep. Mark Longietti |
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Longietti proposal addressing mortgage crisis
endorsed by House committee
HARRISBURG, Feb. 14 – State Rep. Mark Longietti, D-Mercer, announced this week that the state House Commerce Committee unanimously approved legislation he introduced that would address some of the root causes of the mortgage and foreclosure crisis affecting many Pennsylvania residents.
Longietti said his bill (H.B. 1081) would help crack down on fraudulent home appraisals which many financial experts believe has played a major role in the country's current mortgage crisis. Longietti's proposal would provide additional reasons for denying, suspending or revoking an appraiser's certificate in Pennsylvania. This would include two specific changes: denying an appraisal certificate if the applicant had his or her right to practice suspended or revoked by a federal or state government agency, or if an appraiser had been found guilty by a civil court of involvement in a fraudulent appraisal.
"Based on statistics from 2006, many Wall Street and financial experts believe that mortgage fraud could total a record $4.5 billion, nearly a 100 percent increase from 2005," Longietti said. "It has played a major role in the financial crisis we are witnessing and forcing many banks to foreclose on the homes of honest, hardworking citizens. These schemes would not have worked if not for the willingness of certain unscrupulous appraisers to inflate the values of homes far in excess of what they were worth. This proposal would help prevent those who committed fraud in another state from coming to Pennsylvania and setting up shop here, which is especially important to border communities like Mercer County."
Longietti said his measure also would reform the State Board of Certified Real Estate Appraisers to provide additional weight against fraudulent appraisals. Currently, the board is comprised of seven members, including the Commonwealth's Secretary, two public members and four state-certified real estate appraisers. Under his proposal, Longietti would add the attorney general and the secretary of Banking, as well a banker with substantial and recent mortgage lending experience and three additional state-certified appraisers to the board.
"According to the Federal Bureau of Investigation, the share of agents and analysts devoted to prosecuting mortgage fraud has risen to 28 percent nationwide," Longietti said. "By adding the state attorney general and the state Banking secretary to the state's appraiser's certification board, we can provide teeth to the enforcement of fighting this crisis here in Pennsylvania."
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