How Do House Appraisals Work?
Is An Appraisal Necessary? When purchasing a home, an appraisal is often required for several reasons. One is to protect the buyer. Sellers may place their homes on the market for more than they are worth in order to recoup their losses, or they may have an inflated idea of how much the home is actually worth based on their original mortgage amount. In having an appraisal done, a new buyer can ensure she isn’t paying above market value for the property. Appraisals also protect the mortgage lender. The appraisal ensures that if the purchaser defaults on the loan, the bank can foreclose on the home and resell it for what it’s actually worth. This is why an appraisal is required by most lenders. How a Home Is Appraised A home is appraised most commonly by comparing it to other homes in an area of similar size. The appraiser inspects the interior of the home to calculate square footage of rooms, room positioning and possible improvements that could increase the value of the home in the fut
