Overview

Lenders sometimes allow refinances without a full on‑site appraisal. That can cut cost and closing time when the lender’s automated valuation tools and risk rules indicate the property value is predictable and the borrower presents low credit risk. Common paths are: Fannie Mae and Freddie Mac appraisal waivers (often called AVM or PIW), VA IRRRLs, and a subset of FHA streamline refis. (See Fannie Mae, Freddie Mac, VA guidance, and the CFPB on appraisals.)

How lenders decide

  • Automated valuation models (AVMs) or data-driven property checks compare recent sales, tax records and public data to estimate value. If the AVM and file risk look good, the lender may issue an appraisal waiver.
  • Lenders run a risk check that typically weighs credit score, payment history, loan seasoning, equity (LTV), property type, and occupancy.
  • Waivers are offered on a per‑loan basis and can be rescinded if something in underwriting changes.

Who can qualify (typical criteria)

Eligibility rules vary by investor and lender. Common criteria you’ll see include:

  • Loan type: conventional loans (Fannie Mae/Freddie Mac) are the most common to get waivers; VA IRRRLs and some FHA streamline products also often bypass appraisals. (Fannie Mae, Freddie Mac, VA)
  • Loan‑to‑value: low LTVs are favored; many approvals cluster at 80% LTV or lower, though program limits differ.
  • Payment history and credit: steady on‑time payments and solid credit scores improve chances.
  • Seasoning: the current mortgage usually must be seasoned (months since origination) to qualify.
  • Property and occupancy: single‑family, owner‑occupied homes are more likely to get waivers than complex or investment properties.

What appraisal waivers do — and don’t — cover

  • Do: remove the need for a paid on‑site appraisal for a rate‑and‑term refinance, lowering upfront costs and shortening closing timelines.
  • Don’t: support most cash‑out refinances (investors typically require a full appraisal). Waivers also don’t replace a title search, inspection contingencies, or lender underwriting requirements.

Practical steps to pursue a waiver

  1. Confirm your current loan type and investor (check your mortgage statement or contact servicer).
  2. Ask lenders specifically whether they offer appraisal waivers for your refinance scenario and whether your file meets investor rules.
  3. Pull a loan estimate and compare total costs with and without an appraisal — sometimes paying for an appraisal makes sense if you expect a higher value that opens cash‑out or better terms.
  4. If you’re uncertain, order an appraisal proactively — it can prevent surprises if the waiver is denied late in the process.

My experience (real example)

In my practice I’ve seen clients with strong credit, 30% equity and clean payment histories receive appraisal waivers and close faster. One homeowner moved from a 4.5% rate to 3.2% using a waiver, saving roughly $500 in appraisal fees and shortening the closing timeline by two weeks. Results vary by market and lender.

Risks and tradeoffs

  • Value uncertainty: without an appraisal you miss the independent verification that could support a higher loan amount or protect against hidden property defects.
  • Waiver rescission: an underwriter can require an appraisal later if new risks appear.
  • Limited use for cash‑out: most cash‑out refinances require a full appraisal.

Where to learn more (authoritative sources)

Helpful next reading on FinHelp.io

Final note and disclaimer

Refinancing without an appraisal can make sense for well‑qualified borrowers and routine rate‑and‑term refis. Policies and program names change, so confirm details with your lender and consider consulting a mortgage professional. This article is educational and not personalized financial advice.