Lender Liability for Negligent Real Estate Appraisals
This article examines the various situations in which people may rely on the actions of a lender subsequent to its receiving an appraisal opinion and to delineate the scope of a lender's liability when the appraisal involved was negligently prepared. The article begins by explaining and analyzing the appraisal process. Then the article explores the tort and contract theories of liability, as well as other potential theories of liability, for negligent real estate appraisals. The article concludes by discussing the determination of damages in the event of liability.