New Jersey Draconian Penalties on Appraisers
The bill proposed by New Jersey Senate lawmakers to create steep penalties for real estate appraisers who undervalue homes because of the owner or buyer’s protected characteristics has been met with both praise and criticism. Supporters of the bill are lauding its potential to combat discrimination in housing transactions, while critics worry that it could lead to unintended consequences due to its disregard for appraisers’ motives.
Violators would pay $10,000 on a first offense, $25,000 on a second, and $50,000 on a third.
On one hand, proponents argue that this legislation will help protect against discriminatory practices when it comes to home valuations and ensure fair treatment for all buyers regardless of their identity. They also point out that violations would be subject not only to hefty fines but also restitution payments equal to the cost of any appraisal found guilty as well as mandatory attendance at anti-bias seminars which should help raise awareness about implicit bias among appraisers going forward.
Republican critics of the bill, however, expressed worries that it would lead to unintended consequences. They argued that appraisers could be unfairly penalized for undervaluing a home due to factors other than bias or prejudice. For example, an appraiser who simply made a mistake in their assessment and was unaware of the homeowner’s protected characteristics would still face steep fines if they were found guilty. Additionally some believe there is insufficient evidence linking racial disparities in home valuation specifically biased behavior amongst professional appraisals rather than other factors like market conditions or location.
It is clear that this bill has many flaws which will likely create more problems than it solves. The reality is that there isn’t much evidence proving discriminatory practices by real estate appraisers against people with certain protected characteristics; yet here we are with a new law requiring violators to make restitution equal to the cost of the appraisal as well as attend anti-bias seminars and fines up to $50,000. It’s almost comical how lawmakers continue passing bills without taking into account any potential repercussions for those whose only crime was offering an educated opinion based on data points available at hand.
In its current form, this legislation seems destined for failure as well as financial hardship for those unfortunate enough to fall victim to its draconian penalties!
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