When ordering an appraisal, you might be surprised to learn that there isn't just one kind. The "scope of work" can vary significantly depending on the lender's requirements and the purpose of the valuation. Here are the three most common types of appraisal reports you might encounter.
1. Full Appraisal (Interior & Exterior)
This is the standard for most home purchases and refinances. The appraiser inspects the entire property—measuring the exterior, walking through every room, taking photos, and noting condition and upgrades. This offers the most accurate valuation because the appraiser sees everything firsthand.
2. Drive-By Appraisal (Exterior Only)
As the name suggests, the appraiser only views the property from the street. They do not enter the home. Instead, they rely on public records and MLS data to assume the interior condition is average for the neighborhood. These are faster and cheaper but riskier if the interior is significantly better (or worse) than assumed. They are typically used for HELOCs or low-risk loans.
3. Desktop Appraisal
In this scenario, the appraiser never physically visits the property. They use data, photos, and floor plans provided by third parties (like real estate agents or homeowners) to determine value from their desk. While convenient, this method relies heavily on the accuracy of the data provided by others.
Which One Do You Need?
Typically, your lender will decide which type of appraisal is required for your loan. However, for private appraisals (like divorce or estate planning), we almost always recommend a Full Appraisal to ensure the highest level of accuracy and defensibility.