What Is Appraisal?

An appraisal is an independent evaluation of a property’s market value performed by a state-licensed appraiser. Your lender orders it to confirm the home is worth at least what you are borrowing, protecting both you and the lender from overpaying.

A typical single-family appraisal costs $300–$600 and takes 1–2 weeks to complete. The appraiser inspects the property, evaluates its condition and features, and compares it to 3–6 recently sold comparable homes nearby. On a $400,000 purchase, if the appraisal comes back at $385,000, your lender will only base the loan on $385,000 — meaning you would need to cover the $15,000 gap with additional cash or renegotiate the purchase price.

Key Facts

• Typical cost: $300–$600 for a standard single-family home; complex or rural properties may cost more
• Who pays: The buyer, usually at the time of order or at closing
• Turnaround: Generally 1–2 weeks from order to delivery
• Validity period: Most appraisals are valid for 120 days
• FHA appraisals: Include additional health and safety checks (e.g., peeling paint, handrails)
• Appraisal waiver: Some conventional loans with low LTV may qualify for a waiver via automated underwriting

Frequently Asked Questions

What happens if the appraisal comes in low?

You have several options: renegotiate the purchase price with the seller, bring extra cash to cover the difference, request a reconsideration of value with additional comparable sales, or walk away if your contract includes an appraisal contingency.

Is an appraisal the same as a home inspection?

No. An appraisal determines market value for the lender. A home inspection evaluates the physical condition of the property for you. Both are important, but they serve different purposes and are performed by different professionals.

Can I choose my own appraiser?

No. Federal regulations require the lender to select the appraiser through an appraisal management company (AMC) to ensure independence. You cannot influence the appraiser’s assignment or conclusions.