Appraised Value Often Not Market Value; Happy Thanksgiving!

This is a reminder that appraised values often do not reflect market values. Appraisers are trained to make a concerted effort to correlate to contract price whenever there is a wide range of adjusted values. In addition, appraisers are severely constrained by appraisal and underwriting guidelines.

We see extreme examples of this in very hot markets where there might be 15 to 20 offers that are all higher than the value that closed comparable sales in the area might indicate. The recent offers are the best indicator of “true market value.” But appraisers are not allowed to correlate to pending sales, and they cannot even consider other offers on the subject property.

This is very important for frustrated borrowers (hoping for higher appraised values) to understand.

Happy Thanksgiving from all of us at JVM Lending.

Jay Voorhees
Founder/Broker | JVM Lending
(925) 855-4491 | DRE# 01524255, NMLS# 335646