Acquisition Due Diligence

A due diligence appraisal is ordered by you, the buyer, and answers your question: what is this home actually worth? A lender's appraisal, by contrast, exists to protect the bank's collateral position, arrives late in the transaction, and is not designed to guide your offer.

Cash buyers have no lender appraisal at all, which means no independent check on the price unless they order one themselves. A due diligence appraisal fills that gap and provides the objective valuation a lender would otherwise require.

A due diligence appraisal is also not a home inspection. The inspection tells you about the home's condition and defects, while the appraisal tells you its market value. The two work together, and serious buyers often use both before closing.

The asking price is a marketing decision made by the seller and their agent. Market value is the price a willing buyer and willing seller would agree to in an open market. These two numbers can be far apart, in either direction, and the difference is where deals are won or lost.

Appraisers measure market value using the sales comparison approach. They analyze recent sales of similar homes, then adjust for differences in condition, square footage, lot, upgrades, and location. The result is a documented, defensible value you can weigh against the asking price.

If the appraisal comes in below the asking price, you have grounds to negotiate. If it comes in above, you can move quickly with confidence. Either way, you are making a six-figure decision with professional evidence rather than a guess.