The appraisal: what the home is worth
An appraisal is a written opinion of the home's value, done by a licensed appraiser. Your lender orders it — usually comparing the home to similar ones that sold nearby — and can require you to pay for it. Why the lender cares: the home is what backs the loan, so they won't lend more than it's worth.
You have rights here. The lender must give you copies of the appraisal promptly — no later than three days before closing. Read it.
What if the appraisal comes in low?
Say you offered $300,000 and the appraiser says $285,000. The lender will base the loan on the lower number. Your options: ask the seller to drop the price, pay the difference in cash yourself, or — if your contract has an appraisal contingency — cancel and get your deposit back. The CFPB warns that paying more than the appraised value is risky. It's usually better to lose a deal than to overpay on day one.
The inspection: what condition it's in
A home inspection is a professional check of the home's physical condition — the roof, the structure, the plumbing, the electrical, the heating and cooling, and signs of water damage. The inspector works for you, not the lender, and gives you a written report of what they found.
Timing matters. Get the inspection done soon after your offer is accepted, while your contract still lets you respond to what it finds. Miss that window and you may lose the right to renegotiate or cancel.
What the standard inspection doesn't cover
Specialty checks are usually separate: termites and pests, mold, radon, the septic system, the pool. In Florida, wind-mitigation and "four-point" inspections are also common because insurance companies ask for them.
What happens after a bad inspection
The report is your negotiating tool. Common outcomes: the seller fixes the big items, the seller gives you money at closing to fix them yourself (often the cleaner deal — you control the work), the price drops, or nothing changes and you decide whether to proceed or cancel. In an "as-is" contract, common in Florida, the seller isn't promising any repairs — your main right is to inspect and then stay in or get out within your window.
Which one do you actually need?
Buying with a mortgage? The lender will require the appraisal, so that decision is made for you. The inspection is your call — and skipping it to make an offer look stronger is how buyers end up owning a $15,000 roof problem. If you must compete, there are safer middle grounds, like a shorter inspection window, rather than none at all.
One more place this shows up: used cars. The same logic applies — a pre-purchase inspection by an independent mechanic is the cheapest insurance you'll ever buy. That's covered in our car-buying guide.