An appraisal determines the fair market value of a property or home. It assures your mortgage provider that you’re paying a fair price for your new home. Appraisals can also help determine the property taxes you’ll pay as an owner. Lenders will often order an appraisal before closing, and it typically costs a few hundred dollars, paid for by the borrower.
An appraisal shares some similarities with an inspection, but there are a few critical differences. An inspection hones in on the structural and operational aspects of the home, looking for problems that may need to be repaired. An appraisal considers the home’s overall appearance and condition to determine the property value.