Do I need an appraisal, and who pays for it?
Answered by Rajiv Verma, Mortgage Broker · Reviewed 13 August 2026 · About a 3 minute read
The direct answer
Usually yes, and it typically costs $300 to $500. Who pays depends on the type of deal. On an insured mortgage — under 20% down — the insurer usually covers it. On conventional, B and private files, you generally pay it upfront, before the lender will proceed.
THE SHORT VERSION
- Typical cost: $300–$500
- Insured (under 20% down) — the insurer usually covers it
- Conventional, B and private — you pay, and usually upfront
- Some A-lender files use an automated valuation instead — no appraisal, no fee
- You pay the fee. The lender owns the report. That one catches people out.
What an appraisal is actually for
A lender is being asked to lend money secured against a property. They need an independent opinion of what that property is worth — not the listing price, not what the neighbour got, and not your estimate.
An accredited appraiser inspects the property, compares it against recent sales, and produces a report with a value the lender can rely on.
That value drives everything else. The 80% ceiling, the room available, the loan-to-value the lender is comfortable with — all of it is calculated from the appraised value rather than what you think the place is worth.
When you might not need one
On some A-lender files, an automated valuation is accepted instead. The lender’s system estimates the value from data rather than sending anyone out. No inspection, no fee, and a much faster file.
Whether that’s available depends on the property, the location, the loan-to-value and the lender. It’s far more common on straightforward urban properties with plenty of comparable sales — and much less likely on rural properties, unusual homes, or anything where the data is thin.
Who pays, by deal type
| Type of file | Who pays | When |
|---|---|---|
| Insured — under 20% down | The insurer usually covers it | — |
| Conventional — 20% or more down | You | Upfront |
| B / alternative | You | Upfront |
| Private / MIC | You | Upfront |
“Upfront” is the word that matters. On a private or B file, the appraisal is usually paid before the lender will commit — so it’s money spent with no guarantee of an approval at the end of it. That’s normal, and it’s worth knowing before you’re asked.
The part almost nobody tells you
You pay for it. The lender owns it. That’s true whether the lender ordered it or your broker did. If your file has to move to a different lender, the report doesn’t automatically travel with you — the original lender has to release it and it has to be re-addressed. The full answer is here, and it’s worth reading before you pay for anything.
What can go wrong
The value comes in lower than expected. It happens, and it changes everything downstream — less room, a smaller loan, sometimes no deal. This is the single biggest reason not to plan around your own estimate of value.
The property is hard to appraise. Rural, acreage, well and septic, unusual construction, very few comparable sales. Expect a higher fee, a longer wait, and a more cautious number.
You pay twice. If the file moves and the report can’t be released, a second appraisal and a second fee follow.
What to check
- Whether an appraisal is definitely required, or whether an automated valuation might do
- The exact fee, and whether it’s payable upfront
- Who the report will be addressed to
- What happens if the file moves — ask before you pay, not after
- Whether your expectation of value is realistic, based on actual recent sales
What to do next
Before you pay for an appraisal, it’s worth a conversation about whether one is needed and what the value is likely to come in at.
Send me the address and your numbers, and I’ll give you a realistic view before anyone spends anything.
Related questions
- I paid for the appraisal. Do I own it?
- How much equity can I actually borrow against my home?
- Costs & Fees — start here
Answered by Rajiv Verma, Mortgage Broker · Mortgage Architects — FSRA Brokerage Licence #12728 · Licensed in Ontario · Office 289.505.0631 · Direct 647.291.7116
General information about Ontario mortgages — not financial, legal or mortgage advice. Appraisal costs and lender requirements vary. Every file is reviewed individually.