It sounds too good to be true but it really is! The housing market is so solid that Fannie Mae and Freddie Mac have recently begun issuing “appraisal waivers” in certain cases for both purchases and refinances. This is a brand new thing and is a bit of an unpredictable process that seems to hinge on several factors including strength of the file, address used and whether there has been an appraisal performed in the last few years. In order to increase the chances of an appraisal waiver (which saves the client at least $500 and expedites the process) we have learned a trick which is to use the exact USPS address for the subject property when we upload the file.
This helps the chances for an appraisal waiver considerably as does the LTV (Loan to Value) which needs to be at least 90% or below. Lastly, it seems if the subject property has had an appraisal done on it in the last few years that increases the chances for an appraisal waiver as does a solid estimated valuation.
In order to have the best chance for an appraisal waiver we are checking with local appraisers and with Zillow, etc. to arrive at a safe and suitable value to enter into the computer. If we are too high with the value estimation the agencies will require an appraisal every time. All purchases require we enter the agreed upon sales price and as long as it is within 5% of the anticipated computer value and the USPS address is used with a lower LTV the chances are about 50/50 for an appraisal waiver. Appraisal waivers are currently only available for conforming loans up to $679,650 and does not apply to FHA, VA or jumbo loans.
Have more questions on this or any other aspect of real estate financing, refinancing, etc? CLICK HERE or ask below!