Many people confuse appraisals and inspections, but they serve distinct purposes in a real estate transaction. Understanding the difference helps buyers and sellers navigate the process smoothly.
What an Appraisal Does
An appraisal evaluates the market value of a property. Lenders rely on this to ensure the home is worth the loan amount. If the appraisal comes in lower than expected, it can impact financing, renegotiation, or the deal itself.
What an Inspection Does
A home inspection examines the physical condition of the property, identifying issues with structure, systems, and safety. Buyers use inspections to understand potential problems and negotiate repairs or credits. Unlike appraisals, inspections are about protecting the buyer rather than the lender.
Why Both Matter
Bonus Tip: Share a pre-inspection and pre-appraisal checklist with your clients to make the process smoother and faster.
Conclusion
Appraisals and inspections work together to create a fair, informed transaction. Buyers and sellers who understand their distinct purposes can approach the process confidently, avoid surprises, and complete the sale efficiently.
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