FHA: We saw appraisal issues on 37% of HECM loans

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The FHA’s investigation into possible appraisal inflations on reverse mortgage loans revealed an issue the agency decided it must address. The FHA said Monday that out of the 134,000 appraisals it reviewed, approximately 50,000 were inaccurate by at least 3%. FHA Commissioner Brian Montgomery said it was hard to know how many appraisals will be flagged for a second review moving forward, and that the agency intends to monitor the efficacy of the new guidelines throughout the year.