is used to validate the home’s apparent condition.
The role that the home inspection process plays is to protect you from inheriting major issues along with your purchase. Home appraisal, on the other hand, is all about the home’s value, and ensures a lender does not pay more than they should. During the appraisal process, the appraiser determines the market value of the house based on items such as its square footage, the number of bedrooms, the number of bathrooms, the existence and size of the yard, and the existence and size of the garage, if applicable. The appraiser uses analytic data based on home features, comparable sales (“comps”) in the area, and other pricing factors to set a value, or market price, and makes his summary based on complex mathematical calculations. Home inspections, however, focus on home conditions — not value. If those conditions aren’t obvious, the home appraiser won’t factor them into the market price of the home. For example, a bulging wall or a moldy basement are highly noticeable, and will be reflected in the appraisal; however, electric wiring that’s not up to code or the condition of the insulation will not be noticeable or included in the appraisal, but will show up in the inspection report (along with the noticeable issues). Some mortgage guarantors require home inspections along with the home appraisal, as the guarantors have specific requirements of what should and shouldn’t be in the house. A property that possesses any of the red flags can’t be approved until all of these red flags are eliminated. If inspections are made properly, you’ll be able to know your future home’s exact conditions. Be absolutely sure that you have a trustworthy and reliable home inspector on your side, as, essentially, the whole deal now depends on this individual.
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