The home appraisal is different from the inspection as the appraiser is hired to let the lender know the value and condition of the home. FHA, VA, Rural Development and even Conventional appraisals will also include a check for health and safety issues and any major structural issues with the home.
When we write the offer, we enter a dollar amount that the seller will agree to pay for a repair if the appraiser calls out items to be repaired. If the repair is more costly than that amount, the seller has the option of just making the repair anyway, or negotiating the price of the repair with the buyer. If the repairs are too costly, the seller can decide just to cancel the purchase agreement! This does not happen very often.
Usually most items have already been addressed due to the inspection, so it is not common for the appraiser to call out items, but it can happen. Realistically, if the items the appraiser calls out are not repaired, you will not be able to get the loan. These items will need to be repaired before closing.
The appraiser will research comparable sales and provide an opinion on the current value of the home.
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