Is Your Appraisal Process Breaking Federal Law?
Dave Biggers is the founder and Chairman of a la mode. With a Realtor mother and an appraiser father, he was pre-destined to be holding “the dumb end of the tape” with his dad while still in high school, and paid for college as a residential and commercial appraiser. An engineering and economics major, Dave used his technical background and understanding of appraising to start
a la mode while still in school in 1985.
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Lenders are under more regulatory compliance scrutiny than ever, especially as consumers engage lawyers nationwide in foreclosure, valuation, and predatory lending lawsuits -- many of which are turned into class actions. Unfortunately, some lenders are discovering to their chagrin that the way they order and receive appraisals is indeed breaking federal law, specifically the GLB (Gramm-Leach-Bliley) Act.
If appraisals are ordered or received using regular unencrypted email, or even via fax machines in an open unsecured area, then GLB is being violated, since those contain consumer data that GLB mandates as protected. If sales contracts are attached to appraisal orders and reports, then it's even worse. And storing printouts of those documents in cardboard boxes or unlocked file cabinets is strictly forbidden. Nevertheless, every day, many lenders are subjected to every one of those risks.
A consumer privacy breach can be exceptionally expensive, and everyone in the transaction can get mired in the ensuing legal liability mess. With consumers more militant and better armed than ever, most lenders are one non-shredded trash bin or accidentally forwarded e-mail away from a privacy lawsuit.
That's where our Mercury Network comes in. It can eradicate the legal liability associated with ordering, receiving, managing, and storing appraisal-related documents. Mercury is fully GLB-compliant, with end-to-end encryption, a secure upload/download container for sales contracts and other sensitive documents, appraisal PDFs that are never directly attached to email messages, and secure paperless storage of transaction documents.
Using an AMC doesn't automatically solve the problem. Far too many AMCs use non-secure processes either internally or with the appraiser, mortgage broker, or real estate agent. And under the GLB's "Safeguards Rule", the lender is responsible for the actions of suppliers to whom the consumer's private information is entrusted. If they aren't 100% GLB compliant, then the lender isn't either, and GLB holds the lender legally liable for not auditing the practices of business partners. Think of it as "SAS-70 with a $100,000 fine per audit violation plus a prison option". It's not a pretty picture.
We know these issues, and can solve them for you, because we literally "wrote the book" on GLB as it pertains to appraisers (see the white paper, here).
Contact us today for a complete assessment of how Mercury can be used to eliminate your GLB liability. Simply email us at info@MercuryVMP.com or call us at 1-800-252-6633. We look forward to hearing from you
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