Home Appraisal
What Is an Appraisal?
An appraisal is a professional assessment of a property’s market value conducted by a licensed appraiser.
Lenders require appraisals to confirm that the property’s value supports the loan amount.
Appraisals protect both borrower and lender from overpaying or over-lending.
Why It Matters in a Mortgage
Appraisals affect:
- Loan approval
- Loan-to-Value ratio
- Required down payment
- Closing timeline
If the appraised value comes in lower than the purchase price, the borrower may need to:
- Renegotiate price
- Increase down payment
- Cancel the contract
How Home Appraisal Works
Appraiser reviews:
- Comparable home sales
- Property condition
- Location factors
- Market trends
A formal valuation report is issued to the lender.
Appraisal vs. Inspection
Appraisal → Determines value
Inspection → Assesses condition
They serve different purposes.
FAQs About Appraisals
Can I dispute an appraisal?
Yes, in certain cases.
Who orders the appraisal?
The lender.
Does appraisal affect interest rate?
Indirectly, through LTV.
Related Terms
