NCUA Sues Appraiser Over Failed Real Estate Loan
SALT LAKE CITY – In one of the first actions of its kind, NCUA filed suit against a real estate appraiser it says provided a faulty appraisal for a loan that left the now defunct Utah Central CU, which NCUA took over two years ago, holding the bag for more than $400,000.
The suit, filed in federal court here, claims that Blaine Park breached his professional duty by “failing to provide a service at an appropriate level of performance and by failing to abide by the professional standards he purported to follow.”
According to NCUA, the then-troubled credit union would not have made the 2007 loan for $584,000 if the licensed appraiser had not provided a $730,000 appraisal. The eventual default on the loan cost the credit union a loss of $407,000.
The appraisal, which NCUA claims should have been closer to $520,000, violated the Uniform Standards of Professional Appraisal Practice. “The credit union,” claims the suit, “would not have made the loan if the appraiser had performed his appraisal with care, skill and diligence.”
Utah Central, a one-time $190 million credit union, was one of a handful of large Utah credit unions to fail in 2009 and 2010. It eventually was acquired by Virginia’s Chartway FCU in an assisted purchase and assumption merger in which NCUA agreed to assume millions of dollars of losses.
Lawyers for Park did not return phone calls seeking comment.