Valuation vs. Appraisal

Font size :
Q. When I apply for a home loan, do I have to have a valuation done on the property or can I just get an appraisal done? Are there any differences between the two besides the price?



A. A valuation and appraisal are similar in that both of them calculate what the market value of the property should be. However, they are fairly different when it comes to applying for a home loan. A valuation is a formal report completed by an accredited valuer who has completed the training and has the necessary qualifications. A valuation is a more detailed inspection as the lender needs to see that the property can be used as security for your loan and if there is a forced sale, the market value can cover the cost of the mortgage.

However, an appraisal is not a legally binding document, so it cannot be used when you apply for a home loan. An appraisal is usually done by a real estate agent and can give you a guide as to what you may sell your property for. But be wary when choosing an agent to complete the appraisal as they may be over confident with the property value in order to gain you as a customer. The best thing to do is to get a few appraisals done by different real estate agents to see what the average price is.
 

With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now

Mortgage News and Articles

How to tell when a housing market is cooling How to tell when a housing market is cooling

You need to check clearance rates, listings, and the price gap, among other factors Read more

Growing demand for green apartments in Sydney Growing demand for green apartments in Sydney Both owner-occupiers and investors favour eco-friendly buildings for their energy-saving features and reduced environmental footprint ... Read more

Are property investors as rich as they appear? Are property investors as rich as they appear? A multi-property portfolio doesn’t guarantee easy millions ... Read more

Be proactive about getting a better mortgage deal Be proactive about getting a better mortgage deal Apathy could be costing you a considerable amount of money over the lifespan of your loan ... Read more

More mortgage news and articles

Sponsored Links

Monday, Sep 25, 2017
Top Featured Rates
Top Bank Rates

Get help choosing the right home loan

Let us help you find the right home loan for your needs.

Tell us a bit about your circumstances:
  • Purpose of mortgage
  • Household Income
    $
  • How much do you want to borrow?
    $
  • How much deposit do you have?
    $
  • How much is your house worth?
    $
  • How much do you still owe on your mortgage?
    $
  • What type of mortgage do you have?


  • How much is your new home?
    $
  • How much do you want to borrow?
    $
  • How soon do you want a mortgage?
Next
  • First name
  • Last name
  • Where do you live?
  • Phone number

Special Offers

Related Keywords