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Why banks and agents don’t value your home the same ?

By on Nov 15, 2015 in Appraisal, Business, Real Estate |

It is very clear that banks and agents don’t value homes the same. Their prices always differ or have variances. Have you ever wondered why this discrepancy? How can a house be valued at several prices? How do you determine the right price? These variations exist for a number of reasons. The value of the bank If your home is to be mortgaged, then most certainly your lender will have to value it.This satisfies the lender and gives him confidence that your asset provides ample security against the amount of money borrowed. The asset acts as a collateral. Such that if you are unable to repay back the amount borrowed plus the interests the lender which is the bank can sell the property so to recover back its cash. Therefore most of the valuations of the bank are slightly lower conservative as compared to the agents. Some of the times the valuations are approximately 10%-20% less than the...