To not make this information available to appraisers would be criminal. Seriously shameful if that were to occur.
If the homeowner is going to get a free pass from credit issues, a free pass from eviction, and a fresh start, it’s only fair that the neighbors know about it. You can’t say that when the seller goes to the open market and sells the house that sets the market price. Sure it does but we need to know what the previous sale was, and a principal reduction should be considered an arms length transaction between the bank and owner.
