{"id":704,"date":"2021-10-21T10:00:42","date_gmt":"2021-10-21T10:00:42","guid":{"rendered":"https:\/\/www.realtyhop.com\/mortgage-center\/?p=704"},"modified":"2023-07-22T13:38:11","modified_gmt":"2023-07-22T17:38:11","slug":"what-is-an-appraisal","status":"publish","type":"post","link":"https:\/\/www.realtyhop.com\/mortgage-center\/what-is-an-appraisal\/","title":{"rendered":"What is an Appraisal, and How Much Does It Cost?"},"content":{"rendered":"

If you’re like millions of potential home buyers looking to finance their home purchase with a mortgage, a home appraisal is a must-do. While the appraisal process might seem straightforward, it can be stressful, too, especially if the appraisal comes in too low. The best way to use a home appraisal to your advantage is to understand what it is, how it works, and the associated costs.\u00a0<\/span><\/p>\n

In this article, you’ll learn more about what an appraisal is, who pays for it, how long it takes, and what could potentially hurt your appraisal.\u00a0<\/span><\/p>\n

What is an appraisal?<\/span><\/h2>\n

An appraisal determines the fair market value of a property. Typically, it is done by a professional real estate appraiser, who estimates the value of a property by looking at comparable properties and recent sales in the area.<\/span><\/p>\n

An appraisal protects the buyer from paying too much above the actual value of the property. But more importantly, it protects the lender from shelling out more money to the borrower, whether for a purchase or mortgage refinance. No lender will approve a mortgage for $450,000 if the home is only worth $300,000, for example. That is why, once a home is under contract, a lender will typically require an appraisal to determine whether the agreed sale price reflects the actual value of the property.\u00a0<\/span><\/p>\n

Home inspection vs. appraisal<\/span><\/h2>\n

Don’t confuse an appraisal with a home inspection. A home inspection, usually hired and paid by the buyer, focuses on the property’s condition. It’s a more in-depth process, and a good home inspector can tell you if there are problems to be addressed and repaired, including plumbing and structural damages.<\/span><\/p>\n

An appraisal, on the other hand, is an assessment of a property’s fair market value. A real estate appraiser does take into account any visible defects and damages, but it’s purely to help determine the property’s fair market value.<\/span><\/p>\n

How much does a home appraisal cost?<\/span><\/h2>\n

The average cost of home appraisals in the U.S. varies across states and cities. Generally, most single-family homes will cost you around $300 to $400. While multifamily or larger units may cost an upward of $600.\u00a0<\/span><\/p>\n

The cost of an appraisal depends mainly on the following factors:\u00a0<\/span><\/p>\n