Appraisal and a Home Inspection - What's the Difference

Dated: January 27 2021

Views: 1485

muldrowrealty.com

If you’re planning to buy a home, an appraisal is an important step in the process. It’s a professional evaluation of the market value of the home you’d like to buy. In most cases, an appraisal is ordered by the lender to confirm or verify the value of the home prior to the purchase. It’s also a different step in the process from a home inspection, which assesses the condition of the home before you finalize the transaction. Here’s the breakdown of each one and why they’re both important when buying a home.

Home Appraisal

When you apply for a mortgage, an unbiased appraisal (which is required by the lender) is the best way to confirm the value of the home based on the sale price. Regardless of what you’re willing to pay for a house, if you’ll be using a mortgage to fund your purchase, the appraisal will help make sure the bank doesn’t loan you more than what the home is worth.

This is especially critical in today’s sellers' market where low inventory is driving an increase in bidding wars, which can push home prices upward. However, the lender will only allow the buyer to borrow based on the value of the home. This is what helps keep home prices in check. If there’s ever any confusion or discrepancy between the appraisal and the sale price, we will help you navigate any additional negotiations in the buying process.

Home Inspection

The home inspection is a way to determine the current state, safety, and condition of the home before you finalize the sale. If anything is questionable in the inspection process – like the age of the roof, the state of the HVAC system, or just about anything else – you as a buyer have the option to discuss and negotiate any potential issues or repairs with the seller before the transaction is final. Again, we will help you through this part of the process.

Bottom Line

The appraisal and the inspection are critical steps when buying a home, and you don’t need to manage them by yourself. Let’s connect today so you have the expert guidance you need to navigate through the entire home buying process. You can reach us at (936) 776-5161 or (936) 776-5153.

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Kim & Andy Muldrow

Experience has taught us that everyone has a story and communication is key! Whether you're buying your first home or selling your third, you can feel assured that we will help you make well informed ....

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