An inspection and an appraisal are two very different things, but both are vital to the purchase of a home.

The appraisal is a requirement by your chosen lender to make sure the home you're purchasing is worth the money you're wanting to borrow. An appraiser will compare the value of your property to similar homes and comparable recent sale prices. This comparison establishes the value of the property to the lender.

The home inspector is hired by you and the home inspection report is your piece of mind that the home does not need any major repairs prior to closing. Most lenders are now encouraging home buyers to have the property inspected - even newly constructed homes.

Home inspections are so valuable to the home buyer that the U.S. Department of Housing and Urban Development (HUD) now requires buyers to sign a Consumer Notice advising them to get a home inspection in addition to an appraisal before purchasing a house with an FHA mortgage.