Appraisal waiver eligibility on a conventional mortgage comes down to three things: your loan-to-value ratio, the property itself, and whether Fannie Mae or Freddie Mac already has enough data on the home to trust the reported value. If all three line up, the automated underwriting system offers your lender a “value acceptance” waiver, and no appraiser ever visits the property. Government-backed loans don’t qualify, and even a qualifying conventional loan can lose the offer before closing.
What Determines Whether You Qualify
You don’t apply for a waiver. When your lender submits your loan through Fannie Mae’s Desktop Underwriter or Freddie Mac’s Loan Product Advisor, the system checks the property address and reported value against a database of prior appraisals, sales records, and market activity. If the data supports the value with enough confidence, it returns a value acceptance offer. If not, you get a traditional appraisal.1Fannie Mae. Value Acceptance2Freddie Mac Single-Family. Automated Collateral Evaluation (ACE)
For Fannie Mae specifically, a prior appraisal for the property generally needs to already exist in its Collateral Underwriter database. No prior appraisal, no offer. And if a previous appraisal on the property was flagged for overvaluation, the system blocks a waiver.1Fannie Mae. Value Acceptance
The biggest borrower-side factor is your loan-to-value ratio. For purchase transactions on primary residences and second homes, both Fannie Mae and Freddie Mac allow value acceptance up to 90% LTV. The Federal Housing Finance Agency raised that ceiling from 80% in 2023, which opened the program to buyers putting as little as 10% down.3FHFA. FHFA Announces Updates to Enterprise Policies on Appraisals, Loan Repurchase Alternatives, and Pricing Notifications Refinances can also receive offers. Limited cash-out refinances and certain cash-out refinances qualify, with LTV limits varying by property type and occupancy.4Fannie Mae Single Family. Value Acceptance
The property itself has to fit a narrow profile:
- One-unit home only. Two-to-four-unit buildings are excluded.
- Primary residence or second home. Investment properties generally don’t qualify.
- Existing construction. Homes still being built can’t be evaluated by the automated system.
- Purchase price and estimated value both under $1,000,000. At or above that figure, the transaction is ineligible.5Fannie Mae. Value Acceptance + Property Data
Manufactured homes and cooperative units are excluded outright. Meeting every threshold still doesn’t guarantee an offer: the system also needs enough recent comparable sales in the neighborhood.
Situations That Disqualify You
A few disqualifiers surprise borrowers who otherwise look eligible on paper. If you’re using rental income from the subject property to help qualify for the loan, your lender must order a traditional appraisal even if the system offered a waiver. Leasehold properties, homes in community land trusts, and properties with resale price restrictions are also excluded.1Fannie Mae. Value Acceptance5Fannie Mae. Value Acceptance + Property Data
Federally declared disaster areas are another common block. Fannie Mae updates Desktop Underwriter with ZIP codes in FEMA-declared disaster zones, and properties in those areas can’t receive new value acceptance offers. A lender may still exercise a waiver issued before the disaster declaration if they’ve confirmed the property wasn’t damaged.6Fannie Mae. Properties Affected by a Disaster
Government-Backed Loans Don’t Qualify
Value acceptance is a conventional loan feature only. FHA loans require an appraisal that also checks HUD’s minimum property standards. USDA rural development loans mandate an appraisal using the sales comparison approach. The VA has explored alternatives like desktop and exterior-only appraisals but does not currently offer an automated waiver comparable to value acceptance or ACE. If you’re using a government-backed loan, plan on paying for a full appraisal.
The Hybrid Option With Wider Eligibility
If a full waiver isn’t available, you may still qualify for the inspection-based middle option. Fannie Mae calls it Value Acceptance + Property Data; Freddie Mac calls it ACE + PDR. A trained property data collector visits the home, photographs the interior and exterior, draws a floor plan to ANSI standards, and reports on condition. The collector is not an appraiser and gives no opinion of value. The data flows into the automated system, which uses it alongside existing records to confirm value.5Fannie Mae. Value Acceptance + Property Data7Freddie Mac Single-Family. Property Data Collection: An Overview
Eligibility is broader here. The FHFA raised the purchase LTV limit for these inspection-based waivers to 97%, so buyers putting just 3% down can qualify.3FHFA. FHFA Announces Updates to Enterprise Policies on Appraisals, Loan Repurchase Alternatives, and Pricing Notifications The data collector must pass an annual background check, be professionally trained, and have no financial interest in the transaction. Lenders oversee collector performance and must discontinue underperformers.7Freddie Mac Single-Family. Property Data Collection: An Overview If the collector flags a safety or structural concern, the lender has to bring in a qualified professional before the loan can proceed.5Fannie Mae. Value Acceptance + Property Data
How You Can Lose a Waiver Before Closing
A value acceptance offer isn’t locked in when it’s issued. Several things can pull it back.
Time is the cleanest limit. The offer expires if it’s more than four months old on the date of the promissory note and mortgage. A delayed closing means a fresh Desktop Underwriter submission, with no guarantee the system will make the offer again.1Fannie Mae. Value Acceptance
Changes to the deal can also kill it. If the price or estimated value gets renegotiated to $1,000,000 or above, the waiver disappears. If anyone orders a traditional appraisal for the transaction for any reason, the lender can’t exercise the offer. And if the lender learns new information about the property’s condition, they must order an appraisal regardless of what the system said.1Fannie Mae. Value Acceptance
Your final Desktop Underwriter submission must still show the offer. If you resubmit with different loan terms and the system no longer makes it, the waiver is gone. For the hybrid property data option, the data collection itself is valid for 12 months from the date it was performed, but the value acceptance offer still carries the four-month expiration.5Fannie Mae. Value Acceptance + Property Data
Should You Accept the Waiver
Being offered a waiver isn’t a reason to take one. The lender’s interest and yours don’t fully overlap. The lender wants to know the property is worth enough to secure the loan. You want that too, but you also want to know whether you’re overpaying and whether the home has problems you can’t see.
Automated valuation systems estimate market value from comparable sales data. They can’t see a cracked foundation, an aging roof, or water damage behind the walls. A licensed appraiser physically walks the property and notes condition issues that affect value. Skip that and you’re leaning on exterior data and historical records that may not reflect what the house looks like today.
Overpaying at purchase can catch up with you. When you go to sell, a buyer’s lender may order a traditional appraisal, and a lower valuation can derail the sale or force a price cut. The same risk shows up when you try to refinance: if the purchase price was high relative to actual condition, your equity is thinner than you think.
A waiver is also not a substitute for a home inspection. Even if you accept it, hire an inspector. An appraiser checks condition as part of a value assessment; an inspector examines structure, mechanical systems, electrical, plumbing, and roof in far more detail. Skipping both leaves you blind on the biggest purchase most people make.
What Accepting the Waiver Saves You
A traditional single-family appraisal typically costs between $300 and $600, with higher prices in expensive markets and for complex properties. Freddie Mac puts the national average around $600.7Freddie Mac Single-Family. Property Data Collection: An Overview The appraisal also adds time. Scheduling, inspection, and the written report can add one to three weeks to closing, sometimes more in busy markets.
A full value acceptance skips both the fee and the wait. The hybrid property data option still costs money, averaging around $200 per Freddie Mac’s figures, but closes an average of 10 to 12 days faster than a traditional appraisal.7Freddie Mac Single-Family. Property Data Collection: An Overview In a competitive market, that speed can decide the deal.