Georgia appellate courts recently issued several opinions pertinent to the day-to-day operations of Georgia lenders. The following summaries of the opinions warrant review and consideration in order to avoid a number of potential pitfalls.
- An appraiser’s inclusion of a margin of error in making a value determination could save lenders from certain challenges during confirmation proceedings.
In one of its most recent banking opinions, the Georgia Court of Appeals issued a November 10, 2011, decision that emphasizes the importance of utilizing value appraisals that attach a margin of error when seeking judicial confirmation of a foreclosure sale. In Superior Home Design, LLC v. State Bank & Trust, a borrower challenged a trial court’s deduction of property taxes paid by the lender in determining that a foreclosed property sold for its true market value. The Court of Appeals found no need to address the merits of the borrower’s challenge, however, because the property sold for an amount that was within the 5 percent value margin of error assigned by the lender’s appraiser. Because the 5 percent margin of error created a value range that encompassed the actual sale price, the Court of Appeals affirmed the trial court’s confirmation of the foreclosure sale.