Home inspection versus home appraisal

An inspector and an appraiser have a different set of skills and are trained and certified in different processes with different areas of expertise. However, there are a few things in common when it comes to home inspection and home appraisal, like that they both benefit the homeowner and the lender, as they ensure the home is worth the correct amount, and it is also safe and functional to live in.

 

It is recommended (and often required) for a loan to get an appraisal and an inspection, and it benefits both the homeowner and the buyer in the future. While both services include an assessment of the property, they benefit both parties in different ways,

 

 

What is an appraisal?

An appraisal is a process required for most mortgage loans that’s used to determine the estimated market value of a home. An appraisal consists of factors such as checking the location of the home, the condition and value of similar and recently sold houses in the area, and a walk through of the home to determine the market value. A home’s market value is used in the lender’s final decision to approve the loan amount.

 

If the initial appraisal is lower than the offer price, the difference will have to be paid out of pocket, but if the appraisal comes back higher than the offer price, you’ll have more equity in the home automatically.

 

What is a home inspection?

A home inspection is an examination of the home to determine its condition. During the inspection process, the professional inspector will examine the structure of the home, the roof, attic, basement, electrical system, plumbing, exterior, and any other items on their inspection checklist.

 

They will produce a report of their findings, which will determine the overall conditions of the home that helps the seller and buyer configure what needs to be done.

 

 

What is the difference between a home appraisal and inspection?

A home appraisal determines the value of the home, while a home inspection determines the condition of a home. Also, home appraisals are required by a lender, but home inspections aren’t. A home inspection may impact your ability to get the loan you need, but an inspection won’t.

 

 

 

Get ready to get your mortgage loan – after your home appraisal and inspection, of course. Contact us today to talk to our experts and apply for a loan now.