Nolte Appraisal Services

Assuming a decent credit rating, any potential home buyer can secure a loan for a house. Why? Because these transactions are secured by a very valuable asset: the home itself. If a borrower defaults on a loan, the risk for the lender is often only the difference between the value of the home and the amount outstanding on the loan, less the amount it costs them to foreclose and resell the property. For this reason, lenders are very wary of lending more than a certain percentage of a homes value. Traditionally, this has been 80 percent.