Appraisal
An appraisal is an independent assessment of a property’s market value, typically required during mortgage approval. The appraiser reviews comparable sales, condition, location, and market conditions.
The appraisal helps ensure the mortgage amount is reasonable relative to the property’s value.
Why this matters:
Buyers may assume the purchase price determines value, but an appraisal can affect financing. A lower appraisal may require a higher down payment or renegotiation.
Related Mortgage Terms
Often confused with:
Equity — Equity is your ownership value; appraisal is a valuation step that can affect it.
Closely related
Refinancing — Appraisals are common in refinance transactions.
Mortgage — The appraisal supports the lender’s risk decision.
Next step
Refinancing — See how appraisals and borrowing limits come together in practice.