The home buying journey – it’s an exciting, yet complex process. One pivotal player in this journey is the home appraisal. A home appraisal can be a double-edged sword, influencing your mortgage application in ways you might not expect.

This blog will delve into the dynamics of how an appraisal can impact your mortgage application and provide some fresh insights.

An appraisal is a professional assessment of a property’s market value. It’s generally conducted by an impartial licensed appraiser. The report produced can have a significant impact on your mortgage application.

The first way an appraisal affects your mortgage application is through the loan-to-value ratio (LTV). If the appraised value comes in lower than the sale price, it can drastically increase the LTV ratio, which could discourage lenders from approving your mortgage application.

Moreover, an appraisal can also highlight unforeseen issues with the property. These issues can range from structural problems to legal discrepancies, all of which could potentially derail your mortgage application. A less discussed, yet crucial aspect of an appraisal’s impact is on the mortgage insurance.

A lower-than-expected appraisal can increase the cost of your mortgage insurance, adding to your financial burden.


A home appraisal is more than a procedural step; it’s a pivotal component of your home buying journey. Understanding its potential impact on your mortgage application is crucial for navigating this journey successfully. Stay proactive, anticipate possible hurdles, and keep your financial picture in perspective.