DayCents

Home Appraisal

A home appraisal is an independent professional's estimate of a property's market value, ordered by the lender to make sure the home is worth what you're borrowing. If it appraises below the purchase price, the lender won't finance the gap — a common deal snag.

A low appraisal can force the buyer to renegotiate, pay the difference in cash, or walk away. Appraisals also determine how much equity you can tap in a refinance or HELOC, since lenders lend against appraised value, not your estimate.