Once you're under contract, the buyer's lender sends out an appraiser to make sure the purchase price is in line with your property's value. Here's what to expect — and how to prepare — so there are no surprises.
Where it fits
The appraisal isn't something you order before listing — it's a step in the buyer's loan process. Here's the typical sequence once an offer is accepted.
An offer is accepted and the deal heads toward closing.
The buyer's lender hires an independent appraiser.
They inspect the home and pull comparable sales.
The opinion of value helps set the mortgage terms.
Good to understand
Appraised value is a key factor in underwriting. Lenders generally lend against the appraised value, and the loan-to-value (LTV) ratio shapes how much can be borrowed and on what terms. A high LTV often means the buyer must carry private mortgage insurance (PMI).
An appraisal is a professional opinion of value, not an exact science. Results can vary depending on when it's done and who's doing it, and shifting market conditions can move the number meaningfully.
Appraised value leaves out special considerations that affect real-world price — for example, a seller's need to move quickly. It's one important input, not the entire story.
Appraisals are somewhat backward-looking, relying on sold data from comparable properties — "comps" — to arrive at a reasonable value. Fast-moving markets aren't always fully reflected.
For selling, appraisals typically help determine market value or factor into pricing. But appraised value also shows up elsewhere — for insurance value, replacement value, and the assessed value used for property taxes — so the "value" of your home can mean different things in different contexts.
A realistic price reduces appraisal surprises. Start with a free, no-pressure estimate of your Las Cruces home's value.
How to prepare
A clean, tidy, easy-to-walk home lets the appraiser do their job efficiently and see the property at its best.
Have a list of recent upgrades and improvements, plus relevant comparable sales, ready to share.
Pricing in line with the market from the start reduces the chance of an appraisal gap derailing the deal.
Good to know
Once you're under contract, the buyer's lender sends out an appraiser to make sure the purchase price is in line with the property's value. It's part of the loan underwriting process, so it typically happens after an offer is accepted, not before listing.
The buyer's lender orders the appraisal through an independent appraiser, and the buyer usually pays for it as part of their loan costs. As the seller, you don't choose the appraiser, but you can help by making the home accessible and sharing recent improvements and comparable sales.
A value below the agreed price can affect the buyer's financing, since lenders base the loan on the appraised value. Depending on the situation, parties may renegotiate, the buyer may cover the gap, or the appraisal may be reviewed. Your agent will walk you through the options for your specific contract.
An appraisal is a licensed appraiser's formal opinion of value for the lender, while an agent's comparative market analysis is a pricing tool to help you list competitively. Both lean on recent comparable sales, but the appraisal is tied to the buyer's loan and the CMA guides your strategy.
Make the home clean and easy to access, handle minor repairs, and have a list of upgrades and recent comparable sales ready to share. Curb appeal and a tidy interior help, too. Curious where your value stands before any of this? Request a free home value report on this page.
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The best defense against an appraisal surprise is a realistic price. Start with a free, no-pressure estimate of your Las Cruces home's value.
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Part of the Seller's Resource Library — practical, no-pressure guides for Las Cruces home sellers.