A group of homeowners in West Valley, AZ today filed suit against KB Homes and Countrywide contending the two conspired to inflate the selling price of homes during the peak of the housing market and even as prices began to decline. According to one article, the 7 plantiffs are claiming customers lost billions and the scheme contributed to increased foreclosures and defaults.
The suit focuses on 2 states and traces activities back to 2006. According to the National Law Journal, plantiffs are “alleging Los Angeles-based KB Home steered home buyers to Countrywide, which then steered them to LandSafe Appraisal Services, a wholly owned subsidiary of Countrywide. LandSafe then used appraisers who would arrive at inflated values by selecting properties that weren’t comparable, relying on pending sales instead of completed sales, and using false statements about the housing markets in Arizona and Nevada, the suit alleges.”
This is the second case filed against Countrywide this year. Both suits were brought by Hagens Berman Sobol Shapiro, which is located in Seattle, WA.