Who Pays For a Home Appraisal: Buyer, Seller, or Lender?

When buying, selling, or refinancing a home, an appraisal is almost always a required step in the process. An appraisal verifies the home’s fair market value so the lender can approve the right loan amount. Usually, the buyer pays for the home appraisal, but it can also depend on the situation — no matter if you’re buying a home in Charlotte, NC or Salt Lake City, UT.

Who pays for the appraisal fee?

In almost all financed home purchases, the buyer is responsible for paying for the home appraisal, even though the lender orders it to confirm that the property’s value is equal to or greater than the loan amount.

You’ll usually pay for the appraisal after you lock-in your rate but before closing. Sometimes, the fee or a credit for the fee is collected at closing, but most lenders require payment in advance before the appraisal can take place.

Average appraisal cost: $400–$900

Who orders it: Your lender

Purpose: To confirm the home’s value for the mortgage approval

Because appraisals happen early in the lending process, the fee is typically nonrefundable once the report is complete, even if your loan is denied, the deal doesn’t go through, or you switch lenders.

Why don’t sellers pay for the home appraisal before listing?

While it might seem like an appraisal would help sellers set an accurate listing price, they’re often considered an unnecessary expense for sellers—an appraisal is mostly a tool for lenders. A lender requires an appraisal to verify the home’s value for a loan, but sellers will use a real estate agent’s comparative market analysis (CMA) to set their listing price.

A CMA, referred to as comps, gives a free, data-driven estimate of a home’s market value based on similar recent sales, current listings, and local trends. It’s fast, flexible, and tailored to pricing strategy, while an appraisal is a more rigid, loan-based valuation—but both can be affected by the rapidly changing housing market.

That said, some sellers choose to order a pre-listing appraisal if:

• Their home is unique or difficult to price using comps.
• They plan to sell for-sale-by-owner (FSBO) without an agent to guide them.
• They want extra confidence before listing in a shifting market.

For most sellers though, a professional appraisal before listing is an unneeded cost, especially since the buyer’s lender will require a new appraisal anyway once an offer is accepted.

Who decides the appraisal fee?

Buyers don’t actually choose their appraiser or shop around for a price. Most lenders work with an Appraisal Management Company (AMC), which functions as a middleman between lenders and licensed appraisers.

The AMC assigns a local appraiser to evaluate your property and sets the appraisal cost based on the home size and location, the type of property, and how complex or unique the process is.

These fees are standardized within each lender’s network to keep the process fair and compliant with federal lending laws. This setup helps prevent any potential conflict of interest between lenders and appraisers (for example, lenders can’t pressure appraisers to say the home is worth a certain value).

Because of this system, appraisal fees can vary slightly from lender to lender, but they’re not negotiable with the appraiser themselves. The appraiser will send the invoice to the lender who then passes it directly on to the buyer.

What happens to the appraisal fee if the deal falls through?

Basically, the appraisal is a nonrefundable step in the due diligence process, similar to a home inspection fee.

If the sale doesn’t close—whether due to financing issues, inspection results, or a change of plans—the buyer still pays for the appraisal if it’s already been done. Once the appraiser has looked at the home and issued a report, the service is complete, and the cost remains your responsibility.

Can you transfer an appraisal to another lender?

Buyers might switch lenders mid-transaction if they found a better rate elsewhere or were denied the loan. Sometimes it’s possible to transfer the appraisal over, but if a new appraisal is required by the new lender, the buyer pays again. The loan type and individual lender policies are what will determine if a completed appraisal will transfer.

• Conventional loans: Transfers may be allowed if the new lender accepts the same appraiser and management company (like if buying a house within the same area).
• FHA, VA, or USDA loans: These are usually assigned to the property and can be reused within a set time frame.

When the seller might pay for the home appraisal

Buyers almost always pay for the home appraisal, including if the first one expires or there’s a change in lenders. But if the appraisal comes in low and the buyer has an appraisal contingency, then the cost of a second appraisal will likely fall to the seller disputing the report. 

Sometimes the seller might agree to pay the appraisal fee in other special circumstances:

• Seller concessions: To attract buyers or close the sale, a seller might offer to pay part or all of the appraisal fee as a seller’s credit.
• Low appraisal negotiations: If the appraisal comes in lower than the purchase price, a seller may chip in for a second appraisal or towards the gap in appraised value and offer price to keep the home purchase on track.
• New construction homes: Sometimes builders include appraisal fees as part of a closing incentive or as a negotiation tactic.

Do you have to pay for the appraisal fee upfront?

Most of the time, yes—the buyer pays for the home appraisal before closing, at the time it is ordered to avoid any delays in payment or processing. However, the fee will be listed as part of the closing costs, with a credit saying already paid. If covering the appraisal fee is included in negotiations, the appraisal will still need to be paid for upfront with a credit offered at closing.

For refinancing, the homeowner pays the appraisal fee

When you refinance your mortgage, your lender will ask for a new appraisal to get an idea of your home’s current value. This helps your lender know that your property still supports the loan amount you’re applying for, especially if values in your area have changed or you’ve made upgrades to the home.

A refinancing appraisal shows how much equity you have and helps the lender calculate your loan-to-value ratio, which influences your refinance terms and interest rate. Just like with purchase appraisals, you’ll pay the fee upfront, and it’s nonrefundable once the appraisal is done.

Bottom line

Most of the time, the buyer or homeowner pays for the home appraisal, even though it protects the lender. It is a typical borrower expense and part of the cost of securing a mortgage. You might be able to negotiate for the seller to cover the appraisal fee, but it’s best to budget for it upfront — and remember, once the appraisal is completed, it’s nonrefundable.

Tip: Want a head start before paying for an appraisal? Check your home’s value with Redfin’s Home Value Estimator to see how it compares to similar homes in the area.

FAQs: Who pays for the home appraisal

What happens if I don’t pay the appraisal fee?
If you don’t pay the appraisal fee, your loan process can’t move forward. Lenders require an appraisal before approving or funding a mortgage, and most won’t schedule it until the fee is paid. By failing to pay for the home appraisal, you could delay your closing or even cause your loan application to be canceled.

Why do you have to pay for a home appraisal upfront?
Buyers pay for a home appraisal upfront because the lender needs the report early in the loan process to move things forward on time. The fee covers the appraiser’s work and can’t be rolled into your loan balance since the appraiser is an independent third party. Paying before the appraisal means the report can be completed on schedule, the loan amount can be verified, and the appraiser is compensated even if your loan doesn’t close.

Do I still pay for the appraisal if my loan is denied or I don’t buy the house?
Yes. The appraisal fee must be paid if the service was completed, even if your loan isn’t approved or the deal falls through.

Who pays for a second appraisal?
The buyer is usually responsible for appraisal costs, unless the seller wants to order another one to challenge a low valuation.

Who decides the appraisal fee?
The appraisal management company sets the cost based on property type, market conditions, and turn-around time.

How can I get a house appraised for free?
You can’t get a formal home appraisal for free, and a licensed appraisal is required for lending purposes. But you can use free tools like the Redfin Home Value Estimator or request a comparative market analysis from a real estate agent to get an idea of what a home is worth. If you’re refinancing, sometimes less expensive appraisal options are available, like desktop or drive-by appraisals.

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