A home appraisal is a process by which a real estate appraiser determines the fair market value of a home. You can assure yourself and your lender that the price you have agreed to pay for a home is fair. Appraisals are also often used to determine property taxes, making them a requirement in most counties. Because the appraisal primarily protects the lender's interests, the lender will normally order the appraisal.
An appraisal costs several hundred dollars and the borrower usually pays the installment. A home appraisal is the opinion of a licensed or certified appraiser about the value of a home. The appraisal is based on research into recent sales of comparable homes in the area, an analysis of the property and the appraiser's judgment.