Market appraisals are an assessment of what Estate Agents think can be achieved in terms of sale price for your property. This value is affected by supply, demand and current property market but is not a true reflection of the actual value of the house.
A mortgage provider will insist on a mortgage valuation from a RICS registered Chartered Surveyor. The valuation will consider the structure, market and similar property sales in accordance with the RICS red book standards. In order to provide a mortgage lenders require that mortgage valuations are conducted by firms with suitable levels of professional indemnity insurance.
This allows lenders to make an informed decision regarding the risk associated with the loan requested to mortgage the property. They need to know they have not over extended their loan against a property that isn’t worth the value it was sold for.