U.S. Mortgage Index

Appraised value

Definition

Appraised value is the opinion of a property’s value stated in an appraisal. It is the figure the appraisal report assigns, not the purchase price and not a tax assessment.

In plain English

An appraisal is the report. Appraised value is the number in that report. A buyer and seller may agree on a different purchase price. Lenders use the appraised value, often together with the purchase price, when they measure loan-to-value. This page does not appraise property.

Technical definition

CFPB describes a home appraisal as an independent written opinion of how much a property is worth. Fannie Mae’s consumer glossary treats appraisal the same way. The value figure is this concept.

Why it matters

LTV, mortgage insurance, and cash-to-close discussions depend on which number is treated as value.

Example

Riley’s contract price and the appraisal figure are not the same. The lender’s LTV calculation uses the appraisal figure, or the lower of price and appraisal, according to the loan—not this definition.

Sources reviewed

Important note

Appraised value is not a tax assessment and not automatically the market price.