This is why the appraisal happens before the lender grants final approval of the buyer's loan. Appraisers use a specific formula to figure out exactly how much each home is worth. Good housekeeping can improve a home's valuation. They notice signs of neglect like cracked walls, chipped paint, broken windows, torn carpets, damaged flooring, and appliance wear and tear. Anyone can be an appraiser.
Appraisers have no obligation to reveal home defects to buyers.
No such obligation exists for non-FHA mortgages. An appraisal is identical to a home inspection.