Finance
A Florida property is appraised at $280,000, but the buyer agrees to pay $295,000. The lender will base the mortgage on:
A$295,000 since that is the agreed sale price
B$280,000 since lenders use the lesser of appraised value or sale price✓ Correct
C$287,500 which is the average of both values
D$295,000 but will require additional collateral
Explanation
Lenders always base the loan on the LESSER of the appraised value or the contract sale price. If the property appraises at $280,000, the lender treats $280,000 as the value. The buyer must either pay the difference in cash, renegotiate the price, challenge the appraisal, or cancel the contract (if protected by an appraisal contingency).
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