Definition from Nolo’s Plain-English Law Dictionary
A determination of the value of something, such as a house, jewelry, or stock. A professional appraiser -- a qualified, disinterested expert -- makes an estimate by examining the property, and looking at the initial purchase price and comparing it with recent sales of similar property or items. Courts commonly order appraisals in probate, bankruptcy, or foreclosure proceedings in order to determine the fair market value of property. Banks and real estate companies use appraisals to ascertain the worth of real estate for lending purposes. And insurance companies require appraisals to determine the amount of damage done to covered property before settling insurance claims.