Fannie Mae Form 1004 Desktop is a residential appraisal report that lets a licensed appraiser estimate a home’s market value without physically visiting the property. The appraiser works from floor plans, photos, MLS data, public records, and other digital sources to reach a value conclusion. Fannie Mae made this option permanent for eligible purchase loans in March 2022, and it can trim both time and cost off a traditional appraisal.
Which Loans Qualify for a Desktop Appraisal
The desktop option is narrow. A transaction has to meet every one of these criteria:1Fannie Mae. Desktop Appraisals
- One-unit residential property, including a home with an accessory dwelling unit or a unit in a planned unit development
- Principal residence
- Purchase transaction, including new construction
- Loan-to-value ratio of 90% or lower
- Submitted through Desktop Underwriter with an Approve/Eligible recommendation
The ineligible list is longer. Desktop appraisals cannot be used for two- to four-unit buildings, individual condo or co-op units, manufactured homes, any refinance (whether limited cash-out or cash-out), second homes, investment properties, construction-to-permanent loans, HomeReady, HomeStyle Renovation, HomeStyle Refresh, community land trusts or other resale-restricted properties, or manually underwritten loans.1Fannie Mae. Desktop Appraisals
How the Appraisal Gets Ordered
A borrower cannot request a desktop appraisal. The lender submits the loan through Desktop Underwriter, and if the file qualifies, DU returns a message identifying Form 1004 Desktop as an available appraisal option.2Fannie Mae. Desktop Appraisals DU also offers a hybrid appraisal or a traditional full appraisal alongside the desktop option, so the lender keeps discretion to choose a more thorough method. Some lenders route certain files to traditional appraisals regardless of DU’s message because the lender carries life-of-loan responsibility for the property and appraisal data.1Fannie Mae. Desktop Appraisals
Once the desktop route is chosen, the lender orders the appraisal through its normal channels and the assigned appraiser starts collecting data remotely. If the appraiser concludes the available data isn’t enough to support a credible report, the assignment has to be escalated to a different appraisal type. Fannie Mae’s guidelines specifically prohibit using extraordinary assumptions or completing the report “subject to” later verification of the property’s condition, quality, or physical characteristics.1Fannie Mae. Desktop Appraisals
What the Appraiser Needs to Complete the Report
Because there is no site visit, someone has to supply the raw information. Fannie Mae allows data to come from the buyer’s agent, seller’s agent, homeowner, builder, or the appraiser’s own files, as well as public records, MLS listings, and other internet research.2Fannie Mae. Desktop Appraisals
Floor Plan
A floor plan showing interior walls and exterior dimensions is required for every desktop appraisal.2Fannie Mae. Desktop Appraisals It can be a machine-generated plan from scanning software, a sketch produced by an agent or homeowner using a measurement app, or a plan the appraiser has on file from a prior assignment on the same home. The ANSI Z765-2021 measurement standard is not required for desktop appraisals, though appraisers are encouraged to follow it when feasible.3Fannie Mae. Standardizing Property Measuring Guidelines
Photos and Other Virtual Inspection Data
The Selling Guide does not prescribe a specific photo set for desktop appraisals. It states that virtual inspection methods, including digital photos and videos, “can augment” the data and imagery used in the report.1Fannie Mae. Desktop Appraisals MLS listing photos often carry a lot of the weight, but the appraiser decides whether the imagery on hand is enough.
Verifying Data from Interested Parties
The appraiser may accept data, photos, and floor plans from someone with a financial interest in the transaction, such as the listing agent, seller, or borrower. That data has to be verified against a disinterested source.1Fannie Mae. Desktop Appraisals Public tax records, county assessor data, prior MLS listings, and building permit records all qualify. If a listing agent reports 2,200 square feet and tax records show 1,950, the gap has to be reconciled before the appraiser can rely on either figure.
What Goes on Form 1004 Desktop
Form 1004 Desktop is its own form, not the standard Form 1004 with a box checked. Its official title is the Uniform Residential Appraisal Report (Desktop).1Fannie Mae. Desktop Appraisals The appraiser fills in the subject property section from collected data rather than personal observation, describing features, quality, and condition from photos, floor plans, MLS records, and public data. The comparable sales analysis follows the same logic as a traditional appraisal, with adjustments for differences in size, condition, location, and amenities.
In the Additional Comments section, the appraiser records the Appraisal Assignment Type as “DesktopAppraisal” and the Subject Property Data Collection Method as “Other.”1Fannie Mae. Desktop Appraisals The completed report is submitted through the Uniform Collateral Data Portal, where Fannie Mae’s Collateral Underwriter scores it and flags potential issues for the lender.
What a Desktop Appraisal Costs
Desktop appraisals cost less than traditional ones because the appraiser doesn’t travel to or inspect the home. Fees generally run from about $125 to $400, with most falling between $150 and $300. A traditional full appraisal for a single-family home commonly runs $350 to $600 or more depending on the market. The borrower pays the appraisal fee at closing, and the lender selects the appraiser; borrowers cannot shop for their own under Fannie Mae’s appraiser independence rules.
Challenging a Low Value
If the desktop appraisal comes in below the purchase price, the borrower has one formal challenge available, called a Reconsideration of Value. Fannie Mae allows a maximum of one borrower-initiated ROV per appraisal report, and it must be submitted before closing.4Fannie Mae. Reconsideration of Value
The lender provides the ROV form. The submission must include:5Fannie Mae. Appraisal Quality Matters
- Borrower name, property address, effective date of the appraisal, appraiser name, and date of the request
- A description of which areas of the appraisal are unsupported, inaccurate, or deficient
- Supporting data, including up to five additional comparable properties with MLS listing numbers or other sources, and an explanation of why that data supports a different value
If the submission is incomplete, the lender helps the borrower fill in the gaps before forwarding it to the appraiser. Errors the borrower identifies, such as the wrong year built or an incorrect room count, have to be corrected by the appraiser whether or not the correction changes the final value.4Fannie Mae. Reconsideration of Value
If the appraiser reviews the ROV and stands by the original value, the lender decides whether to accept that conclusion. An unsuccessful ROV does not entitle the borrower to a second appraisal.4Fannie Mae. Reconsideration of Value If the lender finds material deficiencies the appraiser refuses to correct, the lender is required to report the appraiser to the appropriate state licensing board and may then order a new appraisal.5Fannie Mae. Appraisal Quality Matters
When a Desktop Appraisal Has to Be Redone
A desktop assignment can fail partway through and force an upgrade to a full inspection-based report. The most common trigger is insufficient data. Rural properties with few comparable sales or thin MLS coverage often fall into this category, as do older homes with no recent interior photos and sparse tax records.
Other triggers include a Collateral Underwriter score that flags risk the lender is not comfortable with, or conflicting square footage between the floor plan and public records that can’t be reconciled remotely. If eligibility slips after the desktop is ordered, for instance when a price adjustment pushes LTV above 90%, the file has to revert to a traditional appraisal or a hybrid appraisal in which a third-party inspector visits the property and the appraiser completes the report.
The borrower typically pays for the replacement. Assembling a complete, accurate data package before the appraisal is ordered is the best way to avoid a second fee.