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Understanding Home Inspections and Appraisals When Buying Your First Home

As a first-time homebuyer, navigating the terminology and processes involved in purchasing a home can be overwhelming. Two critical steps in this journey are the home inspection and home appraisal. While these terms may seem similar, they serve distinct purposes and offer essential protections for buyers!

Here’s what you need to know:

Home Inspection:

  • Conducted by a licensed professional to assess the property’s condition.
  • Covers everything from the roof to the foundation, plumbing, electrical systems, etc.
  • Helps identify potential issues or safety concerns.
  • Allows for negotiations with the seller based on findings.

Home Appraisal:

  • Determines the property’s market value.
  • Required by lenders to ensure the purchase price aligns with the home’s value.
  • Assesses factors like size, condition, location, and comparable property sales.
  • Discrepancies between appraised value and agreed price can affect financing terms.

Key Differences:

  • Purpose: Inspection finds problems; appraisal determines value.
  • Beneficiaries: Inspection benefits the buyer; appraisal benefits buyer and lender.
  • Negotiation: Inspection results can lead to repairs or price adjustments; appraisal discrepancies may require price renegotiation.

Both processes are crucial for informed decision-making and protecting your investment when buying a home. The Durham Team can guide you through these steps smoothly, ensuring your interests are well represented!

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