Even if a buyer and seller agree on the price of a home, it’s not final until a home appraisal happens—unless it’s a cash purchase. Home appraisers are impartial third parties, and their job is to confirm a deal by evaluating the home’s value. Lenders rely on these professionals to determine whether or not the home is equal to the price agreed upon by the buyer and seller.
Are you in the process of buying or refinancing a home? Get the help you need from the loan brothers at Mares Mortgage!
Home appraisals are an analysis of a property to determine its current market value. During the home-buying process, the lender hires a certified appraiser to evaluate the home and ensure it’s not being sold for more than it’s worth.
Appraisers typically evaluate both the interior and exterior of the property, conduct research on comparable homes, and address any special requests from the lender. The buyer usually pays for the appraisal, which generally costs a few hundred dollars.
Related: House Buying Checklist
Appraisals happen shortly after the buyer and seller agree on a purchase price. The lender selects the appraiser, who schedules a visit with the seller. The process typically includes:
The appraiser walks through the entire home to ensure it’s structurally sound, safe, and updated. They’ll document the number of rooms, condition of major systems, and any recent upgrades. FHA and VA loans may require additional checks, such as verifying appliance function or utilities.
To determine a fair value, appraisers compare recent sales of similar homes in the area using public records and real estate databases.
There are two common methods used:
It’s easy to confuse appraisals with home inspections, but they serve different purposes.
Related: Signs You’re Ready to Buy a Home
After the appraisal is completed, you’ll receive a detailed report that typically includes:
✔ The estimated market value of the home and its effective date
✔ Key characteristics of the property, including condition and upgrades
✔ Market data that supports the valuation
✔ Notes from the lender or appraiser
Yes, if you believe the appraisal is inaccurate, you can request a review or revision. Issues that might warrant a challenge include:
While a second appraisal can’t replace the original in most cases, it may support your argument.
Though appraisals are intended to protect the lender, they also benefit you, the buyer.
✔ Confirm the Home’s Value – Know you’re paying a fair price
✔ Gain Negotiation Power – A low appraisal can give you leverage to renegotiate
✔ Build Equity Faster – A high appraisal gives you instant equity in the property
Related: Benefits of Buying a Home
Ready to take the next step? Contact Mares Mortgage and let’s get started on your dream home today!
.png)
