Prime reporting, sub-prime timing.

• Author: Peters, Charles
• Position: TILTING at windmills - Brief article

Back in 1986, this magazine warned in an article by Steven Waldman of the danger presented by inflated real estate appraisals. A few years later these appraisals proved to be a major factor in the savings-and-loan scandal. Now inflated appraisals are back, playing a starring role in the sub-prime debacle. Bank officials pressure appraisers to inflate the value of a house in order to increase the amount of the loan. A national survey of appraisers in 2006, according to Kenneth Harney of the Washington Post, reveals "that nine of lo appraisers said they had recently been intimidated or otherwise pressured to raise valuations on homes." And far too many of them agreed, in the words of one appraisal company executive, to "roll over and...