Do I Need a Home Appraisal for This Loan, or Can It Be Waived?
Sometimes it can be waived. Many HELOCs use an automated value instead of an appraiser's visit, and some first mortgages can too, when Fannie Mae's system offers what it calls value acceptance. A VA cash-out refinance always needs a full appraisal, and homes in poor condition or with few comparable sales usually do. When you do pay for one, the fee generally isn't refunded once the work is done.
Last updated September 29, 2026When can an appraisal be waived?
Waivers are most common on HELOCs and on loans with plenty of equity and strong credit. Instead of sending an appraiser, the lender relies on an automated valuation model or a review of public data. For loans that follow Fannie Mae's guidelines, its underwriting system decides whether to offer value acceptance on a purchase or refinance; the lender can't simply choose it. When a waiver applies, you usually skip the appraisal fee, though a smaller fee may still apply.
When is a full appraisal still required?
- A VA cash-out refinance: always, unlike a VA streamline refinance (IRRRL), which typically doesn't need one.
- Property condition or uniqueness: a home with visible problems, unusual features or few similar recent sales nearby is less likely to get a waiver.
- State rules: Texas home equity loans, for example, carry their own valuation requirements under the state constitution.
What does the appraisal cost, and when do I pay?
The fee depends on the appraiser, the location and the size and complexity of the home. Federal rules keep the lender from charging it, or any fee other than a credit report fee, until you've received your Loan Estimate and told the lender you want to go ahead. After that, the appraisal is generally yours to pay whether or not the loan closes, because it pays the appraiser for finished work.
What if the appraisal turns up problems?
An appraisal looks at condition as well as value. If the appraiser notes needed repairs, like a safety issue or unfinished flooring, the report can come back "subject to" those repairs. Then the borrower or seller has to fix them, and the home may need a follow-up inspection before the loan can fund.
It depends on your situation:
- A HELOC, or lots of equity and strong credit: an automated value or waiver may be used, saving time and the fee.
- A VA cash-out refinance, or a home with condition issues: plan on a full appraisal.
- The appraisal comes back subject to repairs: the repairs have to be done before closing.
| HELOC, or strong equity and credit | Automated value or waiver |
|---|---|
| Loans following Fannie Mae's guidelines | Value acceptance if the system offers it; otherwise an appraisal |
| VA cash-out refinance | Full appraisal, required |
| VA streamline refinance (IRRRL) | Usually no appraisal |
| When the fee can be charged | After you get the Loan Estimate and say you'll proceed |
Related questions
- the most common mortgage and home equity questions
- can I choose my own appraiser, use my own contact, or ask to avoid a specific appraiser
- do I Have to Pay for the Appraisal Out of Pocket, and Is It Refunded If My Loan Doesn't Close
- can I Reuse or Transfer an Appraisal I Already Paid For to a New Lender
- how much home equity you can access
- HELOC vs home equity loan vs cash-out refinance
Sources
- https://singlefamily.fanniemae.com/property-valuation/value-acceptance
- https://selling-guide.fanniemae.com/sel/b5-4.1-03/texas-section-50a6-loan-underwriting-collateral-and-closing-considerations
- https://www.va.gov/housing-assistance/home-loans/loan-types/cash-out-loan/
- https://www.consumerfinance.gov/rules-policy/regulations/1026/interp-19/
- https://www.consumerfinance.gov/ask-cfpb/how-much-does-it-cost-to-receive-a-loan-estimate-en-2003/
- https://ibuyer.com/blog/appraisal-required-repairs/
Sourced from licensed loan officers and brokers in the FreeRateUpdate network.
Educational information only, not individualized financial or legal advice. Program details and rates change; verify current terms with a licensed loan officer before making a decision.