3 Types of Home Appraisals

A home or house appraisal presents all parties involved with a calculated, unbiased value of the property.

A home or house appraisal presents all parties involved with a calculated, unbiased value of the property.

While one may think appraisers determine an estate’s value by pulling the numbers out of thin air, most home appraisers not only rely on years of industry experience but they also follow standard procedures and guidelines issued by the California Bureau of Real Estate Appraisers.

While a majority of us may be familiar with an appraisal concept, many don’t know that there are different approaches or types of real estate appraisals.

Why Do Appraisals Matter In The First Place?

Handshake between buyer and real estate appraiser

Home Appraisal Value Is a Make-Or-Break Factor for Lenders

Most homeowners rely on a mortgage to afford a property, so the entire transaction’s fate depends on appraisals. If an appraisal is too low, the lender might not approve your loan. 

Insurers Base Their Decisions on Home Appraisals

Most insurance companies use appraisal reports to determine a home’s value, even after upgrades, additions, or renovations. It indicates how much your homes and their contents can be insured.

Home Appraisals Are Unbiased Assessments of the Homes Value

Since everyone involved has some stake in the estate’s value, appraisers are now even more independent than before as they are protected under the Home Valuation Code of Conduct bill. This results in unbiased and accurate assessments that neither the buyer, the seller, nor the lender can refute.

Three Main Types of Appraisals


Full Appraisals

As the name suggests, a full appraisal entails an inspection of the entire property’s exterior and interior. It includes providing notes, taking pictures and compares other similar homes in the vicinity to determine the actual value after taking all factors into account.

Fun Fact: A vast majority of mortgage lenders reply on a full appraisal report, often known as ‘ten o four’ (1004) report in the industry.

Rental Analysis

Often conducted as an addendum to a full appraisal, a rental analysis compares the property’s potential rental income to that of other leased homes in the vicinity instead of comparing them to comps sold.

Fun Fact: It includes a report called 1007 or ‘ten oh seven’ and typically costs some extra $$$ because the investment rental analysis requires more effort, time, and calculations by the appraiser.

Exterior-Only Appraisal

Drive-by or exterior-only appraisals involve the appraiser taking notes and pictures from outside the property, and the documents are often based on observations without entering the home’s premises. They are rarely used when buyers are looking to get a mortgage or buy through the refinancing process.

Fun Fact: They typically cost less than full appraisals as there’s less work and effort involved. Exterior-only appraisal reports are popularly known as 2055 in industrial terms. 

Still confused about choosing the best type of home or house appraisal? Worry not, home appraisers at Torlai Appraisal Service have got your back!

As a family-owned real estate appraisal services, we have property appraisal specialists in our team with a combined experience of over four decades in the field.

Apart from providing unmatched house appraisal services, we’re also certified to offer Probate, FHA, IRS, bankruptcy, REO, and conventional appraisals in an extensive range of areas in the Californian state.

Get in touch with us at 1-209-466-1333 to find out more about residential appraisal costs or fill out our online order forms to schedule a meeting.

Leave a Reply

Your email address will not be published. Required fields are marked *