Author: Michael Hobbs

Appraisal waivers let a mortgage close without a licensed appraiser ever valuing the home. Fannie Mae calls its program value acceptance, and Freddie Mac calls its version ACE. In February 2026, roughly one in four loans sold to the two agencies closed this way. The savings are real. So are the risks, and most borrowers never hear about them.

What Appraisal Waivers Are and How They Work

An appraisal waiver is an offer from a lender’s automated underwriting system to close the loan without a traditional appraisal. Instead of an appraiser’s analysis, the loan relies on automated valuation models and prior appraisal data on file. Property and borrower characteristics in the application round out the picture. Fannie Mae’s value acceptance program generally requires a usable prior appraisal in its Collateral Underwriter database. Freddie Mac’s Automated Collateral Evaluation, or ACE, works on similar principles and caps eligibility at a $1 million value. You cannot request a waiver. The system offers one, and you and your lender decide whether to accept.

How Common Waivers Are in 2026

Waiver use peaked near 50 percent of agency loans during the 2021 refinance boom, then fell sharply. It has not disappeared. According to Appraisal Institute analysis of February 2026 data, the combined waiver share across both agencies stood at 26 percent. The split matters. Purchase loans still get traditional appraisals about four times out of five. Meanwhile, nearly half of no-cash-out refinances close on a waiver. In other words, if you are refinancing, a waiver offer is close to a coin flip. If you are buying, it is less common but far from rare, especially since eligibility expanded to loans with as little as 10 percent down.

What You Gain by Accepting One

The benefits are straightforward. Closings move faster because there is no appraisal appointment to schedule and no report to wait on. The borrower saves the appraisal fee, typically several hundred dollars, since the waiver itself costs nothing. For a routine refinance on a recently appraised tract home in a data-rich market, those savings are genuine and the added risk is modest. The agencies designed these programs for exactly that loan, and on that loan they work as intended.

What You Give Up, and Who Carries the Risk

An automated model has never stood in your kitchen. It cannot see the renovated bathroom that should raise the value, the failing roof that should lower it, unpermitted additions, deferred maintenance, or the industrial yard across the alley. When a waiver replaces an appraisal, nobody inspects anything, so all of it goes unpriced. For buyers, that removes one of the only independent checks against overpaying in a competitive bidding situation. For owners, an automated value that runs low can quietly cost you equity in a refinance. The risk does not vanish with the appraisal fee. It transfers to you, and it surfaces later, at resale, in a dispute, or when the tax bill arrives.

When to Decline the Waiver and Order the Appraisal

Accepting a waiver is optional, and there are situations where declining is clearly worth several hundred dollars. Decline it if the home is unusual for its market: vintage construction, atypical layout, a distinctive lot, or anything an algorithm would struggle to match against comparables. Decline it if the property has been significantly renovated since its last appraisal, because the model is valuing a house that no longer exists. Decline it if you are stretching on price in a bidding war, since that is precisely when an independent check matters most. And remember that waivers only cover the loan. Divorce, estate settlement, and property tax appeals still require an independent appraisal, because courts and assessors do not accept a lender’s automated value. When in doubt, our residential appraisal team can tell you whether your property is the kind an algorithm prices well, before you commit either way.

Get a Value an Algorithm Can’t Provide

PahRoo Appraisal & Consultancy provides certified residential and commercial valuations across Chicago, Dallas, Philadelphia, Phoenix, and Naples. Whether your lender offered a waiver or you need an independent value for a divorce proceeding, an estate, or a tax appeal, our team inspects what automated models never see. Have questions first? Visit our appraisal FAQ or learn more about PahRoo.