At buying an apartment or house in Poland Many clients are surprised when, after submitting an application for mortgage The bank informs me that a property appraisal is required. A logical question arises: Why do you need an appraisal if the purchase price is already specified in the contract?

In fact, for a bank, the transaction price is only one factor. It is much more important to understand, What is the real market value of the property and how suitable is it as collateral for a mortgage loan?.

In this article, we'll explain in detail why banks require property appraisals, what exactly the appraiser checks, and why the same apartment might be approved by one bank and rejected by another.

What is a real estate appraisal?

Real estate valuation (operational, operat szacunkowy) is an official document prepared by a licensed appraiser (rzeczoznawca majątkowy).

During the assessment, the specialist determines:

• market value of real estate;
• technical condition of a house or apartment;
• liquidity of the object;
• compliance of the object with the bank's requirements.

It is on the basis of this document that the bank decides whether it is ready to finance the purchase of a specific property.

Why is the price specified in the contract not enough for the bank?

Very often clients believe that if an apartment costs, for example, 700,000 zł, then it is this amount that the bank takes into account.

In practice, this is not the case.

The price in the contract is the amount agreed upon by the seller and the buyer.

The bank must understand, How much is the property actually worth on the market?.

There are situations when:

• the property is sold below market value;
• on the contrary, the buyer overpays;
• the price is too high compared to similar properties.

Therefore, the bank relies specifically on the appraiser’s report.

What does the bank check during the assessment?

Many people think that the bank is only interested in the price of the apartment.

In fact, experts analyze many more factors.

For example:

• location of the object;
• year of construction;
• building structure;
• technical condition;
• area of the apartment;
• heating type;
• floor;
• condition of common areas of the building;
• legal status of real estate;
• availability of access to a public road;
• possibility of further sale of the property.

All this directly influences the bank’s decision.

Not every property is suitable for a mortgage

It is important to understand one thing.

Even if a client has high creditworthiness, a bank may refuse a mortgage solely because of the property itself.

Each bank independently determines which objects it considers acceptable as collateral for a loan.

This is why the same apartment can be rejected by one bank and fully approved by another.

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An example from our practice

We recently accompanied a client who was buying an apartment in Lublin.

Initially the documents were submitted to mBank.

After conducting a property appraisal, the bank refused to issue a mortgage loan.

The reason was not the client’s income or credit history.

The refusal was related solely to the characteristics of the property.

Among the main reasons were:

• small area of the apartment;
• lack of central heating;
• high level of physical deterioration of the building.

From the point of view mBank such an object was too risky to secure a mortgage loan.

However, this did not mean that it was impossible to buy this apartment.

After analyzing the situation, we selected another bank - Credit Agricole.

This bank assessed the property positively and issued a mortgage loan to the client.

This is why it is very important to understand: If the property has non-standard characteristics or is in poor technical condition, not every bank will be willing to finance it.

Why do banks make different decisions?

Each bank uses its own risk assessment system.

Some banks are ready to lend:

• old houses;
• apartments without central heating;
• small apartments;
• real estate in need of renovation.

Other banks are much more cautious about such objects.

Therefore, the refusal of one bank does not mean, that it is impossible to get a mortgage.

Very often it is enough to choose the right bank.

Is it possible to know in advance whether problems will arise?

In most cases, yes.

An experienced mortgage expert can identify potential risks even before submitting an application.

This allows:

• avoid rejections;
• don't waste time;
• choose the most suitable bank;
• significantly increase the likelihood of receiving a positive decision.

This is especially important when purchasing:

• old houses;
• apartments in pre-war buildings;
• objects without central heating;
• real estate with non-standard area;
• objects with complex legal status.

Results

Property valuation is one of the most important stages of obtaining a mortgage loan.

For a bank, it's not just the apartment's current value that matters, but also whether it can serve as reliable collateral for a loan over many years.

If a property has certain defects, this does not mean that it is impossible to obtain a mortgage.

The main thing is to choose the right bank that is ready to finance exactly this type of project.

In our practice, there have been numerous cases where, after a refusal from one bank, we successfully obtained a positive decision from another.

Therefore, before applying for a mortgage, it is always worth assessing not only your creditworthiness, but also the property itself.

This will help you avoid rejections, save time, and significantly increase your chances of getting a mortgage loan.