Which amount is considered by bank for provide a home loan?
Is it considered what is mentioned in the sale agreement? Or is it considered the actual market value of property?
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Each bank makes its own decisions regarding the value used as the basis of the mortgage, and I can’t say definitively what that basis is. However, in Australia (and I’d imagine elsewhere as well), they would often (always?) have their own valuer to determine the value of the property.
Consider the risks borne by the bank in extending a mortgage: principal and interest to be repaid over a long period. Even if the owner falls on hard times, the bank would still want to be paid, hence the use of the property as collateral - they can sell the house to recoup their funds.
The risk is that the house is worth less than what they want to recoup. So it makes sense for the mortgage to be based on what the bank thinks it can sell the house for, with enough contingencies built in to account for costs of sale, including how long the property might have to sit unsold before a willing buyer is found.
On this basis, I’d expect the bank to use what they deem to be the market price of the property as the starting point of their mortgage decisions.
It is the market value. Most banks would independently evaluate the property value. Generally it should be similar to the agreement value.
The reason for independent evaluation of market value is to rule out fraud. I.e. there are individuals who can inflate the agreement value on paper and get the loan and stop paying. In this case bank is left with property of lesser value.