Appraisal and Valuation

Appraisal and valuation pages explain how lenders and buyers think about property value during a mortgage transaction. This section is about appraisals, value comparisons, tax assessments, and the situations where contract price and supported value do not line up.

Start with Appraisal, Appraised Value, and Market Value to understand how the lender’s value view relates to the broader market. Then compare Assessed Value so you do not confuse tax values with lending values.

Finish with Comparable Sales (Comps) and Appraisal Gap to understand how valuations are supported and what happens when the supported value comes in below the deal price.

As this section deepens, it also explains Reconsideration of Value, Desktop Appraisal, and Hybrid Appraisal so borrowers can understand newer review paths and what options exist when a valuation is disputed.

In this section

• Appraisal
  An appraisal is a professional valuation of a property used to help a lender judge whether the collateral supports the mortgage.
• Appraised Value
  Appraised value is the property's value conclusion as stated in the appraisal report.
• Market Value
  Market value is the price a property would likely command in an open market under typical conditions.
• Assessed Value
  Assessed value is the value assigned to a property for property-tax purposes by the local taxing authority.
• Comparable Sales (Comps)
  Comparable sales, or comps, are similar recent property sales used to help support a home's valuation.
• Appraisal Gap
  An appraisal gap is the difference between the agreed purchase price and the lower value supported by the appraisal.
• Reconsideration of Value
  Reconsideration of value is the process of asking for review of an appraisal when the borrower or lender believes the valuation may need adjustment.
• Desktop Appraisal
  A desktop appraisal is a valuation approach completed without a traditional full interior property visit.
• Hybrid Appraisal
  A hybrid appraisal is a valuation format in which property-inspection work and appraiser analysis are split into separate roles.