The following transactions are not eligible for an appraisal waiver:
- construction and construction-to-permanent loans;
- two- to four-unit properties;
- HomeStyle Renovation and HomeStyle Energy loans;
- leasehold properties;
- community land trusts or other properties with resale restrictions, which include loan casefiles using the Affordable LTV feature;
- co-op units and manufactured homes (including MH Advantage properties);
- DU loan casefiles that receive an Ineligible recommendation;
- transactions using gifts of equity;
- transactions where either the purchase price or estimated value provided to DU is $1,000,000 or more; and
- Texas Section 50(a)(6) loans.
Furthermore, the lender may not exercise an appraisal waiver offer and must order an appraisal if one or more of the following applies:
- DU was unable to identify ineligible criteria in the list above (for example, Texas 50(a)(6) loans);
- the lender is required by law to obtain an appraisal (see A3-2-01, Compliance With Laws);
- the lender is using rental income from the subject property to qualify the borrower; or
- the lender believes that an appraisal is warranted based on additional information the lender has about the property or subsequent events.
See B5-7-02, High LTV Refinance Underwriting, Documentation, and Collateral Requirements for the New Loan for additional information about high LTV refinance appraisal waivers.
For additional information, see B4-1.4-10, Appraisal waivers