What is the consequence of an appraiser not using proper methods on a government loan?

When an appraiser does not adhere to proper methods in the context of a government loan, the ramifications can be severe, as they potentially undermine the integrity of the appraisal process and the overall reliability of the loan. In this scenario, the consequence being identified as a felony indicates that such actions can result in significant legal repercussions, including criminal charges.

Government-backed loans, such as those insured by the Federal Housing Administration (FHA) or the Department of Veterans Affairs (VA), require appraisals to be conducted using established and recognized methods to ensure that the valuations are fair and accurate. If an appraiser significantly deviates from these methods, it could be seen as fraudulent activity, especially if it is intended to deceive or misrepresent property values to benefit the lender or buyer unjustly.

Such serious infractions not only compromise the quality of appraisals but also put the financial stability of the government financing systems at risk. Therefore, categorizing this failure as a felony underscores the critical nature of adhering to ethical appraisal practices, as breaches can have far-reaching consequences for both the appraiser and the broader financial system.