Collateral Value?

[Phil Dwyer]

Does anyone have a client/s that request this type of value. If so, what definition do you use in your reports.

Thanks!

 

[GA Benny]

Barron's Banking Dictionary:
Estimate of value of borrower's pledged collateral as determined by Appraisal. If marketable securities are pledged, the lender is restricted by Federal Reserve Board regulations on Margin lending.

www.lending-source.com
collateral value is usually determined by using the lower of cost or appraised value.

Collateral value is a banking term used to determine the loan to value ratio. As for your job, market value is most likely what you are looking for.

 

[Jim Onderisin]

I agree. It's just another way of saying they want you to appraise market value for mortgage lending purposes.

 

[Phil Dwyer]

The "form" the client has provided, asks for collateral value. However, there is no definition given. Should I include an addendum stating that the appaised value is market value and put the corresponding definintion?
Or am I over thinking this one?

 

[Pamela Crowley (Florida)]

Phil, whatever form, format, narrative, paper towel, you use, you MUST adhere to USPAP Standard 1 for developing your appraisal and USPAP Standard 2 for reporting your appraisal. I'm thinking you are under thinking this one. The Definition of the value you are appraising is mandatory.

Who/what is the client and why do they want this appraisal?
What is the USE of this appraisal and who is the USER?

Please do a google search for the definition of 'collateral'. If I do it for you, typically it won't stick in your brain as well as you doing it for yourself. When was your last USPAP class?

 

[Phil Dwyer]

It's easy to become a form-filler-outer, and get into a lazy routine. That's especially true if you stick to completing one type of assigment for the same types of clients.
This order was something new, so I've been trying to dot my i's and cross those t's. It never hurts to re-read the book.

 

[Pamela Crowley (Florida)]

Good for you!