Appraisal vs. Inspection: Two Different Jobs

These two get confused constantly, and the confusion is expensive.

The appraisal

An appraisal establishes what the home is worth. It exists primarily to protect the lender, which is lending against that property and needs to know the collateral supports the loan. An appraiser looks at the property and at comparable sales, and produces an opinion of value.

An appraiser is not crawling through your attic looking for problems. That is not the job.

The inspection

An inspection tells you what condition the house is in. It exists to protect you. An inspector goes through the systems, the structure, the roof, the plumbing, the electrical, and reports what they find.

An inspection is generally optional from the lender's point of view and essential from yours.

Why the distinction matters

Buyers who treat them as interchangeable are the ones who find out about the roof in year two. An appraisal coming in at value tells you the price is defensible. It tells you nothing at all about whether the air handler is on its last summer.

Read each for what it tells you

• Appraisal came in at value → the lender is comfortable with the collateral
• Appraisal came in low → there is a conversation to have about price, terms, or the file
• Inspection came back clean → you know what you are buying
• Inspection found issues → you have information, and in a market where sellers are competing for buyers, information is leverage

Use both. Read each for what it actually tells you, and do not let one stand in for the other.