If you are planning to buy a house, there are two important processes you that you need to differentiate because people often confuse them. These are the home appraisal and home inspection processes. Here are the major differences between the two processes:
One Is a Professional Opinion
The appraisal is basically an opinion of the appraiser as far as the value of the home is concerned. Although the appraiser bases their opinion on facts and tangible evidence, the end result (dollar value of the home) they come up with is not a fact that everyone will agree on. In fact, if you give different appraiser the same property to appraise, they are likely to come up with different opinions on what the house is worth.
On the other hand, an inspection will unearth factual information on the condition of the house. For example, if the electrical supply in a house is inadequate or if its foundation is settling, then you are likely to get the information on the inspection report irrespective of the inspector you use.
They Focus On Different Things
The focus of an appraisal is to find the value of the property in question. The appraiser uses a variety of tools in reaching their decision. For example, the appraiser will consider the size of the lot, the quality of schools in the neighborhood, the age of the home, the architectural style of the home, and the square footage of the house, among other things.
On the other hand, the focus of the inspection is to investigate the condition of the property – especially the conditions that may affect its safety and structural integrity. Thus, the property inspector will focus on the integrity of the roof, the safety of the electrical system, the adequacy of the plumbing system, among other things.
One Is Required
If you are buying a home on a mortgage, the lender will require an appraisal of the property before it can advance you the loan. This is necessary because the lender wants to confirm that the property is worth at least as much as you are claiming its worth so that it can protect its interest on the property. An inspection, though advisable and useful, is not required by anyone; it is for your own benefit (informs you on the condition of the house).
The good news is that you won't be confused by these two processes or any others if you have a real estate agent guiding you through the home purchase. For more information, contact a real estate appraiser.Share