what are appraisals

An appraisal is a written document that shows an opinion of how much a property is worth. It is an independent assessment of the value of the property, and it describes what makes it valuable and may show how it compares to other properties in the neighborhood. Appraisals are typically used for insurance and taxation purposes or to determine a possible selling price for an item or property. In finance, valuation is the process of determining the value of an investment, asset, or security, and there are three approaches taken, namely discounted cashflow valuation, relative valuation, and contingent claim valuation). In the context of home buying, an appraisal is an unbiased professional opinion of a homes value and is required whenever a mortgage is involved in buying, refinancing, or selling property. A lender uses an appraisal not only to assess the value of the property but also to determine such things as your interest rate, required down payment, and whether you will be approved for the loan.