LOCK YOUR RATE APPRAISAL

An appraisal is typically required prior to officially approving any loan. The appraisal determines the market value of a home and protects the lender by making sure the property has adequate security for the loan they are looking to fund.

Appraisals are done through an appraisal management company, which ensures that they are a third party to the transaction and will give a fair estimate of the value of the home. You pay for the appraisal up front when applying for your loan.

The appraisal report assesses what the property is worth and will detail any major problems, but is not all inclusive like a home inspection. If the appraisal of the property comes in lower than the sale price, the lender will likely deny the loan. This is to protect themselves from funding a loan that is more than the property is worth. However, there are certain measures that can be taken in order to still get approved for the loan:

- Seller agrees to reduce the price

- Higher down payment to reduce borrowed amount needed