When can a lender order an appraisal?

The correct answer is that a lender can order an appraisal once the Intent to Proceed is signed and delivered. This step indicates that the borrower has reviewed the Loan Estimate and is ready to move forward with the mortgage application process. At this point, the lender can be fairly confident that the borrower is committed to completing the transaction and can therefore justify the cost of ordering an appraisal.

Appraisals are important as they assess the property's value, ensuring that the loan amount does not exceed the property's worth. The timing of the appraisal is critical, as ordering it too early, such as immediately after receiving the initial application, could result in unnecessary expenses if the borrower chooses not to proceed.

Ordering an appraisal after the final loan agreement or only after the loan is formally approved would delay the process unnecessarily. The appraisal needs to be conducted while the loan is still being processed, and the signing of the Intent to Proceed allows the lender to initiate this step in the timeline effectively.