Appraisal Waiver Rules Expanded as of January 1, 2025
Mortgage lenders can process more mortgage applications without a property appraisal on purchase transactions starting January 1, 2025. The new rules apply to both appraisal waivers and inspection-based waivers, where additional property data is collected by the lender.
In recent years, appraisal waivers were available on loans sold to Fannie Mae or Freddie Mac for homebuyers with down payments of 20% or more. With this change, homebuyers can benefit from an appraisal waiver with 10% down payment or an inspection-based waiver with just 3% down payment.
- Maximum loan-to-value (LTV) for appraisal waivers on home purchases will increase from 80% to 90%
- Maximum LTV for inspection-based appraisal waivers will increase from 80% to 97%
The Updates to Enterprise Policies announcement was made on October 29, 2024 by the Federal Housing Finance Agency (FHFA) to allow more borrowers—particularly first-time and low-to-moderate income borrowers—benefit from cost savings and reduced closing times.