Is it a Home Inspection or a Home Appraisal?

Is it a Home Inspection or a Home Appraisal?

Buying a home is one of most important and expensive purchases you will ever make. Both you and your lender need to know that the home you’re buying is everything you believe it to be. You will want to know that the home is free from any material defects and the lender needs to know that there is adequate value for the loan. As this infographic illustrates, a home inspection is used to find material defects in the home and the home appraisal is used to determine the property’s market value.

Inspecting for Defects
Home inspections are not required for your mortgage loan; however, it is recommended that every home buyer get one and make it a contingency of the sale. Once the home buyer or their agent orders the inspection, a home inspector will visit the home to check items such as roofing, flooring, windows, plumbing, and electrical systems for material defects. Home buyers are welcome to be at the home during the inspection. This is a great opportunity to find out the ins-and-outs of the home’s various systems. If defects are found and the seller agrees to repair the issue, the work must be completed prior to closing.

Appraising for Value
Appraisals are required for your mortgage loan, so that the lender can determine the home’s collateral value for the loan. Your lender will order an appraisal from a certified home appraiser, who will check the overall condition of the property, measure the home and note any remodeling. They will also check for basic health and safety items and compare the property to similar properties that were recently sold in the neighborhood. A formal appraisal report is issued to the lender and home buyer noting the property’s value.

Give me a call at 765-429-4444 for an appointment or visit me online at http://www.ephmc.com/jwerner