Cuomo Subpoenas Government-Sponsored Lenders
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ALBANY — Subpoenas to government-sponsored lenders Fannie Mae and Freddie Mac sent another shock into the home mortgage industry. The attorney general of New York, Andrew Cuomo, said conflicts of interests are costing consumers thousands of dollars because of inflated appraisals.
Yesterday Mr. Cuomo said he wants to know about loans Fannie Mae and Freddie Mac purchased from banks, including Washington Mutual Inc. The subpoenas also seek to find out how the companies handle appraisals to see if lower income home buyers were stuck with loans based on inflated appraised values. Mr. Cuomo has accused a major appraiser of colluding with lenders to inflate home values and indebtedness for home buyers.
