Fannie Mae Announces Changes to Appraisal Alternatives Requirements

WASHINGTON, DC – Fannie Mae (FNMA/OTCQB) today announced changes to the eligibility requirements for Value Acceptance (previously known as appraisal waivers) and Value Acceptance + Property Data (also known as inspection-based appraisal waivers), two key components of the company’s valuation modernization options. The changes are part of Fannie Mae’s ongoing efforts to offer a balance of traditional appraisals and appraisal alternatives to confirm a property’s value in order to meet the needs of the market.  

Beginning in Q1 2025, for purchase loans for primary residences and second homes, the eligible loan-to-value (LTV) ratios for Value Acceptance will increase from 80% to 90% and Value Acceptance + Property Data will increase from 80% to the program limits. Both options are designed to match the risk of the collateral and the loan transaction.

“Fannie Mae is on a journey of continuous improvement to make the home valuation process more effective, efficient, and impartial for lenders, appraisers, and secondary mortgage market participants while maintaining Fannie Mae’s safety and soundness,” said Jake Williamson, Senior Vice President of Single-Family Collateral & Quality Risk Management, Fannie Mae. “Responsibly increasing the eligibility for valuation options that leverage data- and technology-driven approaches can also help reduce costs for borrowers.”

Since early 2020, Fannie Mae estimates the use of appraisal alternatives such as Value Acceptance and Value Acceptance + Property Data on loans Fannie Mae has acquired saved mortgage borrowers more than $2.5 billion.

Value Acceptance leverages a robust data and modeling framework to confirm the validity of a property’s value and sale price. Alternatively, Value Acceptance + Property Data utilizes trained and vetted third-party property data collectors, such as appraisers, real estate agents, and insurance inspectors, who conduct interior and exterior data collection on the subject property. Lenders are notified of transactions that are eligible for Value Acceptance or Value Acceptance + Property Data via Fannie Mae’s Desktop Underwriter®.