What Is Appraisal Waiver?
Appraisal Waiver: A lender's decision to accept a home's value without a traditional appraisal, on some conventional loans.
Also called: value acceptance
An appraisal waiver (Fannie Mae calls it value acceptance) lets some conventional loans close without a traditional appraisal. The automated underwriting system accepts the purchase price based on data about the property and the market.
Who can get one
Eligibility depends on the automated findings, the loan-to-value ratio, the property type and occupancy. It's more common with larger down payments.
Pros and cons
- Pros: saves the appraisal fee and a week or more
- Cons: no independent check on value, so you lose the protection of an appraisal contingency
Good to know
Some programs use a property data collection, where a trained person gathers information on site, instead of a full appraisal.