Avatar's Blog
» Defining Market Value
In hard money or commercial bridge loans, loans are made based on the market value of commercial or investment residential real estate property. If you are buying property, market value is defined as the price you will pay for the property. This is known as 'today's street price' or the true value of the property. It is what a lender can expect someone to pay for the property if the property needs to be sold quickly in the event that the loan cannot be paid.
Apraised values are not market value, but they are important when preparing for a hard money loan. Avatar Financial Group sends as expert to review existing appraisals of the property and provide an expert opinion of the appraised value for purposes of the loan. If the opinion indicates that the value is at or more than the purchase price, the loan can proceed.
