There are a number of red flags that lenders can watch for in regard to collateral valuation, according to speakers at today’s MBA Fraud Issues Conference in Las Vegas. If a historical listing price for a property is lower than today’s listing price for the same property, there could be a problem. Sales concessions are a huge issue today because they tend to create a result that overstates the actual value of the property. Market information regarding the neighborhood is very important today. Appraisers who go outside the neighborhood to a competing development for comparable sales should make certain that the neighborhoods truly compete with one another. Supply and demand is critical. If demand is low but the valuations are increasing, the lender may have a problem. More to follow…