Free Home Appraisals

Written by Jeremy Horelick
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By strict definition, there is no such thing as free home appraisals. There are free home valuations that are conducted in a multitude of ways, but these are not appraisals per se. Nevertheless, they can be helpful tools in affixing a ballpark price to the property you're hoping to sell (or buy). So what exactly is the difference between the two?

An appraisal is conducted by a state-licensed and regulated appraiser whose job is to be a disinterested third party to both the buyer and seller. As such, the appraiser usually works for the lending company, which hires the appraiser to determine a fair market value for the property in question. This is certainly one method of home valuation, but it is not the only method.

Are There Free Home Appraisals Online?

A great many websites bill themselves as providers of free home appraisals, but this is misleading. What they do instead is use a simple calculator to determine a rough approximation for a property's value based on other homes that have listed or sold in that same neighborhood. More advanced calculators will also juggle things like cap rates, square footage, and living space to come to a more accurate figure, but this does not constitute an appraisal.

You may wonder whether this difference between free home appraisals and other valuation methods is merely semantic, which is a fair question. The reason the distinction is so important is that any credible lender will require an appraisal before moving forward with the deal. If you've pinned your hopes on a valuation you've made from an online calculator, you've may have another thing coming.

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