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Homebuyers Beware: Who’s Ripping You Off Now?—What You Must Know About the New Rules of Mortgage and Credit by Carolyn Warren

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27. Deception Exposed

Some ideas might sound good, but a closer look reveals the pitfalls. For example, it’s been proven time after time that the word free is a lure most people can’t resist. It’s amazing how expensive some of those free offers turn out to be! One common lure used in the mortgage business is the so-called free appraisal report. Let’s take a closer look at that and other ploys.

“Free” Appraisal Report

Appraisers do not work for free. If you get that marketing come-on by a lender, just know you are paying for the appraisal in another way—either through a fee called by another name or through the Yield Spread Premium or overage, which means you took a higher interest rate to cover it.

If a loan officer says, “We pay for your appraisal ...

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