Investments are necessary for business development. It is not always possible to make financial investments from own funds, therefore enterprises resort to lending. One of the components of the procedure for obtaining a loan is an independent assessment of the objects offered as collateral. When issuing a loan to the enterprise against the pledge of property, the bank must evaluate the subject of the pledge. To do this, credit organizations resort to the services of independent experts – appraisers, whose duties include determining the real value of a particular object?
As a result, the report on the valuation of the collateral issued by an expert allows a credit institution to draw a conclusion about the liquidity of the object, the price and the period for its implementation, taking into account market conditions and investment attractiveness
The main tasks solved with the involvement of appraisers in lending
He bank needs to know the real value of the property offered as a pledge and adequately assess the risks of a credit transaction.
The borrower wants to get the maximum credit limit under his asset.
Determining the real market value of the collateral by an independent appraiser allows you to establish a fair ratio between the value of the collateral and the size of the loan, and also helps to prevent disagreements between the parties to the transaction that arise when foreclosing the mortgaged property.
As a rule, the report for the purpose of the pledge indicates the approximate period of exposure and the residual value of the object of evaluation. In addition, a number of banks ask the appraiser to include in the report such a section as the change in the value of objects during the loan period. The key point in the assessment of any property is the analysis of its most effective use. Often, when valuing a property for lending purposes, objects are valued only for current use, and such an analysis is not carried out.
One of the services that an appraisal company can provide to a bank, in addition to an assessment of collateral, is the examination of appraisal reports on the adequacy of the market value of the object of its value in the market. If the value of the expert’s opinion is too high or too low, he should study the calculations and understand the situation.
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The first stage is important from the point of view of terms for obtaining a loan by the borrower. The bank, on the basis of data on the time of valuation of the object, plans when to take out the issue of pledge to the credit committee and with a positive decision if the object of pledge is a property with a land plot, to issue a mortgage. That is, the term of the assessment affects the period of receipt by the borrower of the loan.
The third stage is of no less serious importance when the appraiser works with the bank.
The main claims of the banks to the evaluation reports:
He potential borrower, namely, in most cases, is the customer of the valuation, is interested in ensuring that the estimated value of his property is maximum. The bank, of course, is not satisfied, since in case of non-repayment of the loan, he will be forced to repay his losses by selling the mortgaged property. Since, due to an overestimation, the loan amount was significantly higher than the real value of the collateral, the probability that the bank can cover all its losses on this borrower is small.
There are no references to the sources of information used, which contradicts the standards of evaluation.
The report is oversaturated with excess materials and is unreasonably science-based.
The calculations are based on unfounded assumptions and assumptions, which contradicts the standards of evaluation.
Property valuation is a fairly broad concept. The purpose of the assessment is to determine the value of the object of evaluation at the date of the examination.
What may be subject to evaluation?
The object of evaluation of property valuation in Izhevsk, in Udmurtia, can be both movable and immovable property. This may be: assessment of residential and commercial real estate, transport and equipment, property of enterprises. Recently, the valuation of intangible assets is becoming more common. The assessment is carried out using various methods and techniques, which makes it possible to make the most objective and realistic assessment results (expertise). Mike Gartner Jersey