Understanding the Home Appraisal Process

Understanding the Home Appraisal Process


A home appraisal is a required part of the loan process, and is conducted by a certified appraiser who evaluates and determines the property’s fair market value.

The appraiser’s report includes a detailed look at the home’s general condition and a review of the surrounding area. Since housing markets fluctuate—as do home values—appraisers rely heavily on recent home sales within the last six months in the local area to determine fair market values.

For buyers, appraisals can be a safeguard to ensure that a home’s sales price is reasonable, and that the property is in a good and safe condition to meet the lender’s requirements. For sellers, appraisals also take into consideration any improvements and upgrades, as well as the land’s value.

It is important to know that appraisal guidelines are dictated by lenders and the law. In many states, lenders must disclose the purpose of the appraisal, as each situation carries its own set of rules.


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