You can sometimes borrow more than the asking price on a house. It ultimately depends on the type of mortgage you're applying for.
If you're interested in borrowing more than the asking price on your house because you want to use the balance to pay for home repairs or upgrades, you might want to think about applying for an FHA (203)K home repair loan. This government-backed loan is backed by the Federal Housing Administration and lets you borrow money both for the house and for home improvements by using only one loan.
You have to be the owner and occupant of the home (not a real estate investor) and you have to have a down payment of 3.5% for one of these loans plus the repair costs. You can borrow enough to finance 110% of the home's final value after renovation, with the repair costs placed in escrow at closing and released after a licensed contractor completes the work.