Definition
The assessed value is a home's value as determined by a local government for the purpose of calculating property taxes. It’s often different from the market value.
Understanding Assessed Value in Mortgages
Assessed value appears during the property tax assessment phase of the mortgage process. It's calculated by a local tax assessor and is used to determine property taxes. In simple terms, the assessed value is a number that helps local governments decide how much tax a homeowner should pay. Example: If a home's assessed value is $200,000 and the tax rate is 1%, the annual property tax would be $2,000. It's not the same as market value, which is what a buyer might pay for the home. Assessed value doesn't directly affect the sale price of a home.
