Avatar's Blog
» Determine Value on a Refinance of Commercial Prope
If you are refinancing property, Avatar will send an appointed appraiser to the property to determine what the property will sell for today. The appraiser is licensed to do appraisals, but the work performed is not a complete MAI appraisal as conventionally understood. The appraiser performs consulting services to the hard money lender, determining the current condition quick sale value of the property. No report is available to give to the borrower - the service is to determine a current value, not to generate an MAI appraisal.
The value determined by this appraiser may be something less than the "retail appraised value" provided by an MAI appraiser. Standard appraisals take into account the fact that you would reasonably have a year or so to wait for the right buyer to want and buy your property. In the even that your loan defaults, the lender must sell the property quickly and move on. Lenders are not real estate or business owners. They do not want to own property. So the 'street value' of property you own and want to refinance is, once again, the amount that the property will change hands for today - or reasonably within 1-6 months.
