A settlement of $250 million has been proposed in a class action lawsuit filed against Bank of America and Countrywide Financial Corp by mortgage borrowers who claim that the two companies participated in a real estate appraisal scheme. The plaintiffs in this case allege that the defendants did not give out independent appraisals in conformity with ethical rules set forth by the Uniform Standards of Professional Appraisal Practice.
The Bank of America class action lawsuit was initiated after a former LandSafe Appraisal Services Inc. (LSA) manager named Kyle Lagow filed a sealed complaint against Countrywide, LSA, and Bank of America for damages under the False Claim Act. After the complaint was unsealed, Lagow settled the action and a seperate class action was subsequently filed by borrowers.
“The Settlement confers substantial relief for Class members who will automatically receive a refund check for a percentage of the appraisal fees they paid, without having to complete a cumbersome claim form, answer any questions or provide any documentation,” the motion for preliminary approval of the Bank of America class action settlement states.
The settlement Class includes all residents of the United States who made a mortgage loan application to Countrywide from Jan. 1, 2003 through Dec. 31, 2008 and who used LSA as an appraisal company. Settlement class members will receive checks in the amount of at least 22 percent of the appraisal fee that was assessed in connection with their home loan application.