What is a property appraisal?
A property appraisal is the process of developing an estimate for the value of real property. This includes residential and commercial properties, as well as vacant land.
Lenders typically require an appraisal by a third party (the “appraiser”) of the property to determine whether the loan amount is justified. If the property’s appraised value is below what the buyer has offered, the lender may request the buyer to pay the difference in the appraised value and selling price.
Appraisers must be independent of the loan production and collection processes and have no direct, indirect or prospective interest, financial or otherwise, in the property or underlying real estate transaction. See, Mahnke v. Sup. Ct., 180 Cal.App.4th 565 (2009).