Appraisal - an opinion of the value of a property, usually conducted in conjunction with a loan.

Appraisals can be ordered for a number of reasons including mortgages, home equity lines of credit, mortgage refinances are mere curiosity. In a real estate purchase, the appraisal is ordered in the name of the lender and the cost can be paid by either buyer or seller.

An appraisal is not a statement of a property’s inherent value. Rather, it is an opinion of the value of the property and that opinion often is filtered by the purpose of the appraisal. For example, appraisals used to refinance a property often are higher than appraisals to determine value for purposes of a mortgage.

Appraisal value is determined by comparing the subject property to similar properties - similar size, builder, subdivision, age, amenities, upgrades, etc.