Ask the REALTOR: What’s the difference between a home inspection and an appraisal?

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Ask the REALTOR® is a regular video series in which I answer your most commonly-asked real estate questions, with a new Q&A posting every week. If YOU have a real estate question for me, drop me a note here.

This week’s question: What’s the difference between a home inspection and an appraisal? Here’s the answer in this brief video, and don’t miss the transcript below.

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Hi. This is Cari McGee with Keller Williams Realty. Welcome to this week’s episode of “Ask the Realtor.” Every week, I answer questions from buyers and sellers — and pretty much everyone in between — regarding real estate.

This week’s question is, “Cari, what’s the difference between a home inspection and an appraisal?”

Very common question, and a good one, because they seem, at first glance, to kind of be very similar, but they’re actually pretty different.

A home inspection is likened — by me, anyway, and by a lot of people that I know — to a health checkup that you would have with your doctor. You go to the doctor annually for your exam, and the doctor checks out your respiratory system, your circulatory system, your digestive system, your nervous system, and with all that information together, they give you a good snapshot of what the condition of your body is, at that point in time.

That’s what a home inspection is for a home buyer. The inspector comes out and takes a look at the HVAC system, the plumbing system, the roof, the crawlspace if there is one, the siding, all kinds of major components of a home. And gathering all that information together, they present you with a snapshot of the condition of the home at that time.

An appraisal is ordered by the bank, and the bank is making sure that the house is worth the amount that they’re loaning on it. For example, say the house is $100,000, you’re putting 10%, or $10,000 down, so the bank is loaning you $90,000. The bank has to make sure that house is worth $90,000, to make sure that they are making a good investment in the loan for your home. So they send out an appraiser to determine the condition of the home, and whether it’s worth the $90,000. The appraiser and the home inspector are looking at totally different things, which is why they are different things, but easily confused, because they both involve somebody coming out to your house and weighing in on its condition. But, they are looking for different things.

So, if you have any more questions for me regarding real estate, by all means, give me a shout via any one of the methods that are to follow on the screen. Thanks so much for watching. See you next week.

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About The Author
Cari McGee

My husband and I came to the Tri-Cities in 1994, and we thought it would be a temporary stop on our way to larger cities. He was a television sports anchor at the time, and we planned to go wherever the "next step up" took us. Twenty-plus years later, we're still here and we've loved every minute of it! We have two children now, and we've found the Tri-Cities area is a wonderful place to raise a family. It's a great place to do outdoorsy things -- I like to hike Badger Mountain or run along the river path. I also love reading ... by a cozy fire in the winter or a beautiful picture window in the summer (with the A/C on!). I've been a licensed Realtor since 2004. I earned my managing broker's license in 2016, which means I can run my own brokerage, or create a team of real estate agents and supervise them, which is exactly what I did when I formed the Cari McGee Real Estate Team in 2018! We have administrative and marketing personnel, as well as additional agents to serve you. I became a director of the Tri-Cities Association of Realtors Board of Directors in 2016, became Secretary/Treasurer of the organization, and was elected to Vice President in 2019. Want to talk about real estate? Click here to schedule a meeting with me!

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