The loan process
Home appraisal
Also called: Appraisal
In short
An appraisal is an independent estimate of a home's market value, ordered by the lender to confirm the home is worth roughly what you're paying.
A home appraisal is an independent professional's opinion of a property's market value, based on its condition and comparable recent sales. The lender orders it to make sure the collateral supports the loan amount.
The appraised value interacts with your loan-to-value: if a home appraises below the contract price, the loan is sized against the lower figure, which can require a larger down payment or a renegotiation.
The appraisal serves the loan, not the buyer's inspection needs — it isn't a substitute for a home inspection, which looks at condition in far more detail.
Related
Current as of August 2026.