"In almost all financed home purchases, the buyer is responsible for paying for the home appraisal, even though the lender orders it to confirm that the property's value is equal to or greater than the loan amount. You'll usually pay for the appraisal after you lock-in your rate but before closing. Sometimes, the fee or a credit for the fee is collected at closing, but most lenders require payment in advance before the appraisal can take place."
"While it might seem like an appraisal would help sellers set an accurate listing price, they're often considered an unnecessary expense for sellers-an appraisal is mostly a tool for lenders. A lender requires an appraisal to verify the home's value for a loan, but sellers will use a real estate agent's comparative market analysis (CMA) to set their listing price. A CMA, referred to as comps, gives a free, data-driven estimate of a home's market value based on similar recent sales, current listings, and local trends. It's fast, flexible, and tailored to pricing strategy, while an appraisal is a more rigid, loan-based valuation-but both can be affected by the rapidly changing housing market."
An appraisal verifies a home's fair market value so lenders can approve an appropriate loan amount. Buyers usually pay for appraisals in financed transactions, with payment typically due after rate lock but before closing; some lenders collect the fee or credit at closing. Average appraisal costs range from $400 to $900. Appraisal fees are typically nonrefundable once the report is complete, even if financing fails or the deal falls through. Sellers generally rely on a comparative market analysis (CMA) rather than ordering an appraisal before listing, though some sellers may obtain a pre-listing appraisal for pricing certainty.
Read at Redfin | Real Estate Tips for Home Buying, Selling & More
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