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Appraisals and Inspections Guide

It’s a common mistake to assume home appraisals and inspections are two different words for the same thing. Despite their similarities, each one serves a different purpose and has a different process. Let’s go over what appraisals and inspections are, how to arrange them, and why both are important.


During an appraisal, an objective third party will conduct a surface-level evaluation of the home to assess its market value and confirm that it meets the minimum property requirements for your specific financing circumstances. This step is typically required to secure a mortgage—lenders need to know the home’s value to make sure their investment is protected if the buyer defaults.

During a home inspection, a professional will thoroughly examine the property inside and out to check for damages and flaws in the foundation, roof, walls, plumbing, electrical system, etc. Inspections protect the buyer rather than the lender, so they aren’t necessary to receive financing—but we suggest you think of home inspections as essential anyway.


Both appraisals and inspections usually take place after the seller accepts the buyer’s offer. In most cases, the offer will include a contingency allowing the buyer to pull out of the deal within a short time frame if the home doesn’t pass inspection. If you choose to get an inspection (and again, you really should), schedule it before the appraisal—there’s no point in paying someone to assess the home’s value if you decide to back out.


Where the appraisal is required by the lender, by law the lender needs to order it with an independent appraiser following a government-mandated process. Your home inspection is for your own benefit, so you can select any inspector you would like for that process. If you don’t have one in mind, check with your real estate agent or loan officer for a recommendation for a local inspector to your area.

If you only remember one thing about the difference between home appraisals and inspections, it should be this: Appraisals protect the lender, but inspections protect YOU. Scheduling a home inspection before the appraisal could save you many headaches in the future. If you’d like more information about appraisals, inspections, and how to arrange them, reach out to your loan officer for help.

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