What does an appraisal involve?

An appraisal involves the act or process of estimating the value of a property. This process is crucial in real estate transactions, as it helps to determine the fair market value of a property, which is necessary for buyers, sellers, and lenders alike. Appraisers use various methods and considerations, such as comparable sales, income potential, and the physical condition of the property, to arrive at an unbiased value assessment. This valuation ensures that all parties are informed about the property’s worth and helps facilitate a fair transaction.

The other options pertain to different aspects of real estate transactions but do not directly describe what an appraisal is. Evaluation of mortgage terms involves understanding financing options, while preparation of mortgage applications relates to securing funding. Negotiation of sales contracts encompasses the agreement between the buyer and seller over terms of sale, none of which directly connects to the process of estimating property value.