Appraisal
An appraisal is an independent, professional evaluation of a property's market value, conducted by a licensed appraiser and required by the lender before a mortgage can be finalized.
The appraiser inspects the property, evaluates comparable recent sales in the area, and produces a written report estimating value. The lender uses this report to confirm the home supports the loan amount being requested.
An appraisal is not a home inspection. It does not evaluate the condition of systems like plumbing, electrical, or HVAC. Its purpose is to determine value for the lender — not to identify repairs for the buyer.
Why This Matters: If the appraisal comes in lower than the purchase price, the loan terms may need to be adjusted. Understanding the appraisal process prepares you for one of the most important checkpoints in any real estate transaction.
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