Buyer information

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If you’re buying or selling a home, you’ve probably heard the words inspection and appraisal used close together — sometimes even interchangeably. But these two steps serve very different purposes in a real estate transaction.

Understanding what an appraisal is (and what it isn’t) can help you stay calm, informed, and prepared as you move toward closing.

An inspection is about condition.
An appraisal is about value.

During the home inspection, a licensed inspector takes a deep look at the property’s physical structure and systems — things like the roof, plumbing, and foundation — to identify any issues that might need repair or maintenance.

The home appraisal, on the other hand, is performed by a state-licensed appraiser, whose job is to determine the market value of the property. They’re not checking outlets or searching for leaks; they’re analyzing how your home compares to recent nearby sales to ensure the price aligns with the market.

Both are important — but they serve completely different roles.

In most transactions, the appraisal takes place after the inspection and once the buyer’s loan is underway.

Because the lender is usually the one requiring it, the appraiser’s report helps confirm that the home’s value supports the amount being borrowed.

If you’re paying cash, an appraisal isn’t always required — but many buyers still choose to get one for peace of mind.

When an appraiser visits your home, they’ll take notes and photos to document its features and condition. They’ll measure the home’s square footage, note the number of bedrooms and baths, and assess the quality of finishes and updates.

Then, they’ll compare the property to similar homes that have recently sold nearby — known as “comps” — adjusting for differences like size, location, or amenities.

The final report estimates what the home is worth in today’s market.

You don’t need to overhaul the house for an appraisal, but presentation still matters.

A few quick steps can help make the process smooth:

• Tidy up and declutter so the home feels well cared for.
   
• Make sure every room and system is accessible.
   
• Gather a list of upgrades, improvements, or major repairs.
   
• Touch up small items that show deferred maintenance (like peeling paint or missing outlet covers).
   

While these won’t directly “add” value, they help the appraiser see your home in its best light.

After the visit, the appraiser submits a detailed report to the lender. This document includes their valuation, supporting data, and comparable sales.

• If the appraised value comes in at or above the purchase price — great news! The loan moves forward without issue.
   
• If the value comes in below the agreed price, it doesn’t mean the deal is dead. Buyer and seller can renegotiate, adjust terms, or appeal with additional comparable sales.

The inspection protects you from surprises about a home’s condition.
The appraisal protects everyone from overpaying or over-lending.

Both are essential, but they answer two very different questions:

• Is this home in good shape? (Inspection)
   
• Is this home worth the price? (Appraisal)
   

Knowing the difference — and what to expect from each — keeps your transaction running smoothly and helps everyone reach the closing table with confidence.