If you are looking to purchase a home that has been foreclosed or ceased by the bank, you may see a term listed as EMV. Many people wonder what the EMV term means.

The term EMV means the Estimated Market Value. It is the estimated value that is placed on a home that has been foreclosed. The bank will usually check with several sources to determine what they feel is the value of the property in the present-day real estate market.

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Table of Contents

• EMV Means The Estimated Market Value
  • • You can listen to our podcast, What Does EMV Mean In Home Foreclosure Listings? Below or by clicking here.
• Short Sell Vs. Foreclosure, What Are The Differences
  • Short Sell In Real Estate Defined
  • Foreclosure In Real Estate Defined
• Pre-foreclosure In Real Estate Defined
• Frequently Asked Questions
• Related Questions
  • What Does The Term “COE” Mean In Real Estate?
  • What Is Severance In Property?

EMV Means The Estimated Market Value

EMV is the estimated market value of the home or property. It is often used for foreclosed homes or properties to show the property’s assessed value.

EMV is also used for property tax purposes to show the price a property would likely sell if in the open market. The tax authorities would use the EMV rate to assess the home’s property taxes.

When you see the term EMV for a foreclosure home, the EMV means the estimated market value the bank has come up with for the home—the value the bank has accessed that the home or property is worth.

To come to the EMV value, the bank has usually taken some of the following steps:

• Had Property Appraised – The bank will hire an appraiser to go into the home and appraise the property.
• Tax Records Search – The bank will then look at the tax records of the city/county that appraised the home. These records will also help them to be able to access the property value.
• Perform CMA – They will then ask a broker to perform what is known as a CMA or Comparative Market Analysis or give them a BPO known as a Broker’s Price Opinion. The broker will look at similar houses or properties and then provide an estimate of what they think it is worth; the broker will then come up with their EMV or estimated market value.

The EMV is what someone should be ready and willing to pay for a property. If the bank puts the EMV too high, they may find no one is interested. If they put it too low, they will lose money on the property.

Because it is also essential for banks to get their money back from foreclosure, they want to ensure that the EMV is accurate and they can get at least most of their money back or recover from selling the property.

Banks are not in the real estate business; they are in the business of money. If a homeowner has defaulted on their loan and the home has been foreclosed, the bank’s primary goal is to sell the property or home to get their money back.

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Because a bank does not want to have to sit on a foreclosed loan or have the foreclosed home or property sitting on their books, they will usually be willing to set a price for the home or property so that it will sell quickly.

You can listen to our podcast, What Does EMV Mean In Home Foreclosure Listings? Below or by clicking here.

Short Sell Vs. Foreclosure, What Are The Differences

When the home is ready to foreclosure, the banks may talk about short sell or forecloser. Short sell and foreclosed are for a property that is considered financially distressed.

Short Sell In Real Estate Defined

A short sell real estate transaction means that the mortgage lender or the bank allows the borrower time to sell the house for less than the amount owed on their mortgage.

The advantage to the bank doing this is that the bank does not deal with the sale of the property, but the property owner does. Short sales also help the property owner as they can avoid foreclosure, which would be very damaging to their credit report.

Foreclosure In Real Estate Defined

Foreclosure in real estate is when the home is seized by a bank or investor and put up for sale by them. The bank or investor needs to sell the home or property to get their money back from the bad loan or mortgage.

Every mortgage contract has a lien on the property that allows the bank to control the property if the homeowner stops making its mortgage payments. You do not own the property outright until you have fully paid down your mortgage on the property.

Pre-foreclosure In Real Estate Defined

Pre-foreclosure is the first step that is usually taken before foreclosure. Pre-foreclosure usually happens when a property owner has failed to pay the mortgage between three to six months of payments.

If a borrower finds they are in pre-foreclosure, there are usually three things they can do:

• Pay Past Due Balance In Full – The borrower can pay the past due balance and get their home out of pre-foreclosure.
• Work With The Lender – The borrower can work with the lender to reduce their monthly mortgage payments.
• Short Sell The Home Or Property – The borrower can short-sell the home or property.
• Deed In Lieu Of Foreclosure – The borrower can do a deed in lieu of a foreclosure agreement where they give the mortgage lender the deed to their home or property to avoid foreclosure.

Any foreclosure will show up on your credit report for a long time, making it almost impossible to purchase another home for years. Some homeowners would instead do something as a deed in lieu of foreclosure to avoid foreclosure on their credit report.

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The EMV can be used for a foreclosed home to show the property’s value and for the tax authorities to estimate the taxable value of the home or property.

The EMV is about accessing the property value of a property.

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Frequently Asked Questions

Related Questions

What Does The Term “COE” Mean In Real Estate?

COE is the abbreviation for the National Association of Realtors (NAR) Code of Ethics. The COE or the Code of Ethics, is considered one of the core guiding principles of the real estate industry. The Code of Ethics has seventeen different articles and a host of standards for each article that help guide and define the ethics of the real estate industry.

By clicking here, you can read more about What Does The Term “COE” Mean In Real Estate?

What Is Severance In Property?

Severance is about taking or severing real property so that it now becomes personal property. It also has to deal with the severing or termination of a joint tenancy agreement. In some cases, severance, especially in joint tenancy, can get very messy where the court will need to get involved to decide how the property is severed or disposed of.

By clicking here, you can read more about What Is Severance In Property?.

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