7. Blowing Bubbles

(Original Text, "Mmm, mmm, mmmh. Go Figure" Posted in 2007 by Gary E. Geraci)

Mmm, mmm, mmmh. Go figure.  What’s that you say Mr. and Mrs. Homeowner?  Your bank is ready to foreclose on your home? 

You mean that home I appraised about a year ago for $100,000, the value that at the time your loan officer said was “too low?”  Didn’t you and your loan officer get after me and say that I was “killing the deal?”  Didn’t your loan officer then “save the deal” by calling in another appraiser who appraised the home at $120,000, the exact amount needed to get a new loan?  And you guys now owe $120,000 on a home that every buyer, investor, appraiser, and real estate agent alike knows will only sell for $100,000.  Oh, I’m so sorry that you lost your job Mr. Homeowner.  I understand that you are now forced to sell your home.  You’re kidding me?  No offers yet on your $120,000 sales price?  And you must ask for $120,000 because you owe $120,000?  I see.  


Mmm, mmm, mmmmh. Go figure.

What’s that Mr. Banker?  I agree, that incompetent appraiser! Who convinced him to appraise such property at $120,000 in the first place?  Yeah, I know. What’s that? You’re not going to lose a minimum $20,000 on that $120,000 loan that you made last year? But you’re taking the house back aren’t you?  The homeowners can’t make the house payment and the market is only going to pay $100,000 because every house in the area identical to the one you are taking back is selling for, at the most, $100,000, correct?    What’s that?  You already sold off the loan interests in Mr. Homeowner’s property in a Residential Mortgage Backed Security offering (RMBS)?  


So a Wall Street investor bought the $120,000 note convinced that should the note go bad, the collateral, the home itself, could be sold for $120,000?  So you have passed the risks out of your bank and into the hands of American investors?  Brilliant!  (No wonder your loan officers commit bank fraud so regularly!) The bank’s own investors don’t have to deal with such risks and even if you were found responsible for the bad loan your legal department could simply go after the appraiser and sue him for inflating the appraised value thereby creating all the losses.  After all, your bank did hire an independent, third party appraiser to appraise that property correct?  Nice to absolve yourself of any wrongdoing right?   What’s that?  Seeing a lot of foreclosures as of late? I see.  


Mmm, mmm, mmmh.  Go figure. 

6. You Must Have Been High

 (Original Blog Text Posted in 2007 by Gary E. Geraci, hyperlinks added this posting - Actual names and addresses redacted by author, April 2012.  Where indicated, all dates and case numbers are authentic and can be retrieved under Federal Open Records law.)

“You must have been high.  You must have been sooooo high.” -The Pot/Tool-

E-mail receipt of a formal complaint written December 15, 2005 to the Federal Trade Commission.  Complaint submitted via the Appraisal Institute’s “Appraisal Independence Action Center” complaint portal.

Gary Geraci

From: Appraisal Institute [xxxxx@appraisalinstitute.org]

Sent: Thursday, December 15, 2005 11:43 AM

To: Appraisal Institute

Subject: Appraisal Independence Action Center -- FTC

December 15, 2005

[recipient address was inserted here]

Dear [recipient name was inserted here],

I am a real estate appraiser and I wish to submit a complaint against a non-bank mortgage lender.

The complaint is against:

XXXtrust Mortgage

8330 Any Blvd. STE 130

Anytown, VA 22182-2624

And

Ms. K. N.

XXX Trust Mortgage, Inc

8105 Any Court

Anywhere, VA 22102

Phone: 703-xxx-xxxx

Fax: 703-xxx-xxx

And

BIG Corporation (AMC) South

1063 Any Park Drive

Any Other, VA 23059-4500

Phone: xxx-xxx-xxx

FAX xxx-xxx-xxxx

RE: xxxx Ranch Road 620, Unit xxx, Austin, TX 78734

Complaint: Appraisal Supplantation without Cause

Brief Summary:

Complex property assignment involving highly publicized construction defects, lawsuit, mass eviction, and major re-construction received from BIG, an Appraisal Management Company (AMC). Negotiated a higher fee to provide just compensation for the added complexities.  Clearly communicated due diligence requirements that would need to be performed. 

Approval received from both BIG and XXXtrust Mortgage.

Request engineering report so as to better understand the defects, time-lines, the scope of work to remediate, the probability of ongoing costs, etc, so as to determine probability of higher than Market Special Assessments.  Conducted inspection. Informed shortly thereafter of the properties closing date-just 5 business days from our inspection date.

Continued requesting engineer report that buyer’s representative stated she could provide. 

On 3rd business day since inspection, Ms. K.N., loan production officer of XXXtrust Mortgage left multiple voice mail recordings announcing her displeasure with appraiser methodology. In one such message she stated her prominence as “Top Producer” with

XXXtrust Mortgage. She went on to threaten appraiser by pointing out prospective borrower, Mr. M.D., is related to an executive of BIG. She was prepared to send a “mass e-mail” to BIG if appraisal process continued to impede her time-line. 

Continued to receive multiple calls from every member of the buyer’s team: Ms. K.N., Ms. P., Mr. M.D., and the title representative. 

Numerous requests now made for engineering report including call to engineer.  On the 5th business day since inspection, appraiser received a recorded message from Mr. L.L., the engineer of record for the project.  On the morning of the 6th business day since inspection, appraiser conducted full telephone interview with both the engineer of record and a representative/member of the Condominium Owners Association, Ms. M.S..   

Appraiser learns of a 2.5 million dollars shortfall the condominium owners are responsible for. Amount was borrowed and must be paid back by the owners through Special Assessments.  Without a doubt, this is information of the type, when properly disclosed to potential buyers and Realtors, can create negative perception.  Property value diminution is highly probable. 

Several hours after updating BIG of these latest findings and progress, we learn

from BIG the assignment had been cancelled earlier in the morning at the request of Ms.K.N. of XXXtrust Mortgage.  Ms. K.N. states to Ms. P.P. of BIG that another appraiser was hired and completed appraisal report in less than 24 hours.

Ms. K.N.’s decision to supplant our report is without cause. We clearly communicated complexities, and due diligence requirements.  Every effort was made to complete a credible, reliable, and adequately researched appraisal report.  The independent, third party provision of the appraisal process is violated when a biased, loan production agent

can make the decision to supplant appraisers and appraisal reports when the direction of the appraisal is deemed not to favor a desired outcome.  Ms. K.N. violated appraiser pressure regulations by calling appraiser and making threats to harm appraiser’s reputation with BIG.

We urge a complete investigation.

Sincerely,

Gary Geraci

512-xxx-xxxx

5. Joe Appraiser (A Worldly Kind of Guy)

(Original Text,  "Joe Appraiser on Easy Street" Posted in 2007 by Gary E. Geraci)

Like most in this profession, to make any money as an appraiser I take a bulk of assignments from lenders.

My job is simple.  I write glowing appraisal reports so that loans get approved.  Period.  I don’t worry about doing detailed inspections of the property and I don’t like to photograph things that could lower the value of the property or raise red flags with the lender’s underwriting department; things like cracked slabs, mold, etc.   Reporting things like that kills deals.  I don’t do detailed write ups either. Why bother?  It takes extra time and my client’s look at one thing and one thing only: the final appraised value.  To them, everything else in the report is regulatory boilerplate, fluff.

I keep friends with lenders, loan officers, mortgage brokers, and real estate agents.  I network within their circles, eat and drink well; slap backs, trade stories, and exchange numbers.  I am a go-to guy, the guy on the team that won’t hold things up.  I want to keep my friends happy because they send me lots of business.  More than I can handle.  I write 10 reports a week by myself.  At $250-$350 a pop you do the numbers.  I’ve even molded a couple of apprentices in the office to do another 15 reports a week.  We are in the business of producing “deal winning” reports within 48 hours.  In the fiercely competitive world of lending, killing deals only makes clients unhappy and sends them to the competition. 

Loan underwriters like me because I take the burden of risk off of their backs.  If a family needs money I am not going to write something up that kills their refinance deal.  On paper, any property can be made to look more valuable than it really is.  It doesn’t matter to me that the family might not make enough money to make the new mortgage payments.  At times, clients provide me recently sold, supportive “comparable” property information for use in my report.  I use these in my report to create value because its quick and it supports the value that my client needs to make the deal happen.   Should a deal go bad later, it’s not their back and very unlikely to be mine either.    

Real estate investors like me because I can salvage their deals.  Many “flippers” have gone over budget or have over improved a place beyond what the market is now willing to pay for the place.   Any naïve soul trying to buy the place at a price well above market value usually needs a bank loan to complete the purchase and that’s where I come in.  I’ll produce a reported property value that seals the bank deal.

Face it, today, an appraisal report is a commodity product, a quickly produced report that hits a predetermined collateral value and minimizes any property deficiencies.  The industry simply contracts out for this now, gets exactly what it wants, and yet still covers its own back in the process.  Most mortgage loans it takes in will be packaged into a security offering, moved out of the institution, and sold to the government and increasingly, private sector investors.  With the new influx of capital, the process repeats over and over again.

What’s the harm?  Technically and legally my value is just an “opinion” of value anyway.  If I don’t give a client exactly what he wants, all of the time, he simply finds another appraiser who will.  I don’t have a crystal ball but I know how the real estate business works.  In a few years the property will have appreciated, whether artificially or not, to a value high enough to cover my inflated value.  I don’t lose any sleep over these deals.

“We must always take sides.  Neutrality helps the oppressor, never the victim.  Silence encourages the tormentor, never the tormented.” ---Elie Wiesel

4. Dig

(Original Text Posted in 2007 by Gary E. Geraci)

Dig bury me underneath

Everything that I am rearranging 

Dig bury me underneath

Everything that I was slowly changing

JANUARY 2006: AMERIQUEST MORTGAGE COMPANY, THE LARGEST PRIVATELY HELD RETAIL MORTGAGE LENDER & LARGEST SUBPRIME LENDER BY VOLUME IN AMERICA IS SETTLING WITH 49 STATES AND THE DISTRICT OF COLUMBIA OVER ALLEGATIONS OF UNFAIR AND DECEPTIVE LENDING PRACTICES. 

I would love to beat the face,

Of any mother @#%&!! that's thinkin' they can change me,

White knuckles grip pushing through for the gold,

If you're wantin' a piece of me I broke the mother @#%&! mold,

I'm drowning in your wake

%$#@ rubbed in my face

Teething on concrete

Gums bleeding

AMERIQUEST WILL PAY $295 MILLION TO CONSUMERS IN RESTITUTION.

Dig bury me underneath

Everything that I am rearranging

Dig bury me underneath

Everything that I was slowly changing

THE STATES ALLEGED THAT AMERIQUEST FRAUDENTLY INFLATED APPRAISALS, FABRICATED BORROWER INCOME, MISREPRESENTED LOAN TERMS, USED HIGH PRESSURE SALES TACTICS, PROVIDED UNTIMELY FUNDING, PROVIDED DISPARAGING DISCLOSURES

I struggle in violated space,

Sell out mother@#%&! in the biz that try to %$#@ me,

Hang from their T's rated P.G. insight,

I ain't sellin' my soul when there's nothing to buy

I'm livid in my space

@#%&!! in my face

%$#@ you

While you try

To %$#@ me

SIGNIFICANT INJUNCTIVE PROVISIONS-AMERIQUEST IS REQUIRED TO: SUBSTANTIALLY REVISE ITS COMPENSATION SYSTEM TO ELIMINATE INCENTIVES FOR EMPLOYEES TO DECEIVE BORROWERS, OVERHAUL THE COMPANY’S APPRAISAL PRACTICES BY REMOVING BRANCH OFFICES AND SALES PERSONNEL FROM THE APPRAISER SELECTION PROCESS, PROHIBITING THEM FROM PRESSURING APPRAISERS FOR HIGHER VALUES AND INSTITUTING A SYSTEM OF PERIODIC REVIEW TO ENSURE THE INDEPENDENCE OF APPRAISERS AND THE ACCURACY AND INTEGRITY OF THE APPRAISALS, ADOPT POLICIES TO PROTECT WHISTLE-BLOWERS AND FACILITATE REPORTING OF IMPROPER CONDUCT

Dig bury me underneath

Everything that I am rearranging

Dig bury me underneath

Everything that I was you ain't @#%&!! changing me

dig

dig

dig

dig, kill, now mother@#%&!!

dig, kill, now mother@#%&!!

dig, kill, now mother@#%&!!

dig,

kill.

THE BUSH ADMINISTRATION HAS WATCHED THE SETTLEMENT NEGOTIATIONS CAREFULLY BECAUSE BILLIONAIRE ROLAND E. ARNALL, AMERIQUEST’S FOUNDER AND PRINCIPAL SHEREHOLDER IS PRESIDENT BUSH’S NOMINEE TO BE AMBASSADOR TO THE NETHERLANDS.  ARNALL HAS BEEN BUSH’S SINGLE LARGEST CAMPAIGN CONTRIBUTOR SINCE 2002. www.washingtonpost.com

Let me help you tie the rope around your neck,

Let me help to talk you the wrong way off the ledge,

Let me help you hold the glock against your head

Let me help you tie the rope around your neck,

Let me help to talk you the wrong way off the ledge,

Let me help you hold the glock against your head,

Let me help to chain the weights onto your legs

Get on the plank @#%&!

“WHAT WE’VE SEEN IN HUMAN TERMS IS CATASTROPHIC DAMAGE FOR SOME INDIVIDUALS WHO WERE MISLED OR DICEIVED OR WHO RECEIVED LOANS GREATER THAN THEY COULD POSSIBLY AFFORD BECAUSE OF INFLATED INCOME LEVELS OR APPRAISALS RESULTING FROM EMPLOYEE MISCONDUCT.  THE ABUSES ARE SYTEMIC IN NUMBER AND NATURE” CONNETICUT ATTORNEY GENERAL RICHARD BLUMENTHAL.

Dig bury me underneath

Everything that I am rearranging

Dig bury me underneath

Everything that I was slowly changing

Wish you were committing

Suicide suckin' on a mother@#%&! tailpipe

Dead man walking on a tight rope

Limbless in the middle of a channel bomb's away

UNLESS INDICATED, DATA FACTS EXCERPTED FROM WASHINGTON STATE ATTORNEY GENERAL’S WEBSITE WHERE THE STATE’S FORMER ATTORNEY GENERAL, JOHN MCKAY WAS EMPLOYED UNTIL HIS UNEXPECTED FIRING IN DECEMBER, 2006 DURING A CONTROVERSIAL JUSTICE DEPARTMENT SHAKEUP.

Thanks to mark-hi@hotmail.com for submitting the lyrics. The DIG LYRICS are the property of the respective authors, artists and labels, the lyrics are provided for educational purposes only , If you like the song, please buy relative CD to support Mudvayne.  Copyright © 2000-2007 sing365.com

3. I Wont Do What You Tell Me!

 (Original Text Posted in 2007 by Gary E. Geraci, hyperlinks added this posting - Actual names and addresses redacted by author, April 2012, however all dates and case numbers are authentic and can be retrieved under Federal Open Records law.)

“%@!# You! I Wont Do What You Tell Me!” -Killing in the Name by Rage Against the Machine 

“On 8/20/2004, Ms. N. B., the assignment's Houston, TX loan production officer of MORTGAGE BANK WF calls appraiser and demands that the cost to cure addenda be removed from the appraisal.  Appraiser states that this may not be possible. Ms. B. begins to attack appraiser’s qualifications with appraiser.  Ms. B. threatens to contact appraiser’s appraisal management company, AMC V.  Appraiser ends call as Ms. B.'s personal attacks are not welcome.” 

• excerpt from August 25, 2004 complaint letter to the Comptroller of the Currency: OCC Case 510551: 
• Undue lender pressure from MORTGAGE BANK WF loan officer and
• MORTGAGE BANK WF's appraiser management company, AMC V 
• to affect appraisal outcome on property located at 11111 Any Road, Leander, TX 78641 

“As stated in the report, during the inspection the appraiser noted multiple items of work in progress namely, electrical work in progress, septic tank work in  progress, plumbing work in progress.  In addition, electrical safety hazards, fire hazards, security hazards, and conditions for termite infestation and lead based paint hazards were observed. Multiple occurrences of curable functional obsolescence were documented and the associated costs to cure quantified according to the intended user’s scope of work request and standard USPAP practice.  Without a doubt, these items, if revealed to a market participant, would affect value or financing concessions.  After the inspection, the appraiser was made aware of “Addendum to Inspection No. 6233” in which the content of the Addendum further supported and continues to support the appraiser’s original observations…. Therefore, we hold that the “Appraiser’s Estimate of Cost to Cure Worksheet” is valid as delivered and no changes will be made.-Gary Geraci”

• - excerpt from Gary Geraci’s appraisal report of property located at 11111 Any Road, Leander, TX 78641, 
• AMC V Tracking No.11038845

2. The Credibility of Rage

(Original Text Posted in 2007 by Gary E. Geraci)
“rage n 1: violent anger” - Webster’s Vest Pocket Dictionary

“Leontius, the son of Aglaion, coming up one day from the Piraeus, under the north wall on the outside, observed some dead bodies lying on the ground at the place of execution. He felt a desire to see them, and also a dread and abhorrence of them; for a time he struggled and covered his eyes, but at length the desire got the better of him; and forcing them open, he ran up to the dead bodies, saying, Look, ye wretches, take your fill of the fair sight.

The moral of the tale is that anger at times goes to war with desire, as though they were two distinct things.  When a man's desires violently prevail over his reason, he reviles himself, and is angry at the violence within him, and that in this struggle his spirit is on the side of his reason.

…passion or spirit when not corrupted by bad education is the natural auxiliary of reason.”  The Republic, Book IV, by Plato

Rage isn’t respectful and is often hushed in schoolrooms, courtrooms and boardrooms alike.  Thank God for “creative license” and the many alternative avenues of free expression like song lyrics, books, poetry, and yes, blogs.  Has not rage of reason inspired resurgence against the unjust? Has not rage of reason resurrected justice?

Injustice is repugnant and so be it the rage borne by it. Such rage aims not to revere. 

Rage borne of indignation is virtuous.

Rage borne of reason is credible.

1. But I Don't Believe

It doesn't matter, God believes in you.

Here I give you what is called personal testimony.   The blog, The Beat Goes On, is personal testimony.  At its worst it is painful, arrogant and self seeking, I agree, but still, I am convinced at its best, the confessions taken together reveal something transcendental, something greater than me, something I am convinced is at work in your life too whether you believe in God or not. 

A few weeks ago I released a posting titled "The Biggest Civil Project" originally written and posted during June 2007.  For me, this period marked what I can only call a pronounced turning point in my life.  The beginning of a tangible  pouring out of God's infinite mercy and grace guiding my own life in a completely new direction.

The following original blog postings are from a dark period immediately prior to this new turn in direction.  During the height of the mortgage and banking industry's fleecing of America, I, an independent "by the book" real estate appraiser, had become the victim of an alleged blacklisting campaign which ended up costing me my appraisal career, first marriage, home, property, and livelihood.  In other words, I had lost nearly everything. 

I hope to demonstrate to you that we are all God's instruments for positive change even when we do not perceive it or necessarily will it.   First, through my own life's confessions, I hope to continue to reveal God's work in progress so that you may see evidence of Him and learn to see Him in your own life too.  Second, I want to inspire you to action when critical events in your life begin to challenge your conscience, knowing God will be on your side too.  Finally, I hope you can tell your own story one day perhaps following the same formula used here: 

 I was on this path, until the Holy Spirit acted in my life, and now, dying to my old self, (an ongoing, never ending process by the way), I am on a new path laid out by Jesus Christ our Savior and Lord.

I will number the entries, beginning with this post, to make them easier to follow and in the order originally written.  The material will be posted unedited and as is except I have opted to replace original use of profanity with symbolic references in respect of my readers.  

So today, on Devine Mercy Sunday 2012, I offer these confessions as my personal "apostolate" or contribution to the Church's call for New Evangelization.   God indeed is merciful.

The Biggest Civil Project

(Original Text Posted June 2007 by Gary E. Geraci)
The biggest civil project that I’ll ever build…

In the modest role as the carpenter’s apprentice, I completed construction on a monumental, Austin “civil” project today.  No, this project has nothing to do with wastewater, water treatment, or highway transportation corridors or is anything like any other privately or publicly financed civil project that I studied during formal engineering school or permitted during my brief stint as a government employee. 

Today, I proudly completed construction on a structure sure to serve the civil masses of Austinites and visitors for years to come…. a rather unassuming, single level cedar faced deck structure abutting the old converted gas station located on the northwest corner of Lamar and Barton Springs Road now owned and operated by the Barton Springs Saloon.  

It just so happens that this famous Austin intersection gets a ton of daily traffic, one of the highest counts in the city according to local store owners.  So I am immensely satisfied in forecasting diverse people of all kinds and social status gathering here to unwind, relax, and socialize -many on top of this very structure, to later leave served, renewed, refreshed, and, well yeah, maybe a little drunk too.   

A tangible product that is honest and full of potential; resulting from a combination of creativity, management, capital, materials, and labor is just like any other civil project of the day.   

What a joy it is to see a couple of patrons already relaxing on the fresh cedar planks placed just moments ago.

 Now working as a carpenter's apprentice and living in a tent camper after divorce and a failed, year long court battle with the banking industry sent me into hard times. Gary Geraci, June, 2007