Home Appraisal 101: What Happens and What If the Value Comes in Low
A home appraisal is an independent estimate of a property's market value, required by lenders before finalizing most mortgages. It exists primarily to confirm the home is worth what's being borrowed against it — a separate check from the home inspection, which evaluates condition rather than value. Who orders it and who it protects The lender orders the appraisal, usually through a third-party appraisal management company, and the buyer typically pays for it as part of closing costs. While the buyer pays, the appraisal is ordered to protect the lender — it confirms the collateral (the home) supports the loan amount, in case of future default. What an appraiser actually evaluates An appraiser typically inspects the property's condition, size, and features, then compares it to recent sales of similar nearby homes ("comparables" or "comps") to arrive at an estimated value. Factors like square footage, lot size, condition, upgrades, and neighborhood ...