AVM Appraisals Facing Controversy
Chase’s motion to dismiss a lawsuit over HELOCs (Home Equity Line of Credit) was denied in a US District Court. JP Morgan Chase was trying to have a lawsuit thrown out of court because of their use of AVM (Automated Valuation Models) to value properties in their portfolio in determining which HELOCs to cut. The judge refused to throw out the lawsuit. This could have a greater impact on the use of AVMs in the future.
“The use of AVM has for once been questioned and acknowledged… So the ruling by the US District Court in the case of Chase and the use of AVM could have far reaching effect on the rest of the real estate industry and their use of past, present and future AVMs” say Frank Garay & Brian Stevens, hosts of the TBWS Daily Show.
Watch the TBWS Daily Show clip below – discussion about AVM starts at 1:05