{"id":13510,"date":"2018-05-22T13:08:31","date_gmt":"2018-05-22T13:08:31","guid":{"rendered":"http:\/\/www.anthonydidonato.net\/wordpress\/?p=13510"},"modified":"2018-05-22T13:08:32","modified_gmt":"2018-05-22T13:08:32","slug":"pros-and-cons-of-bypassing-an-appraisal","status":"publish","type":"post","link":"https:\/\/www.anthonydidonato.net\/wordpress\/pros-and-cons-of-bypassing-an-appraisal\/","title":{"rendered":"Pros and Cons of Bypassing an Appraisal"},"content":{"rendered":"

Pros and Cons of Bypassing an Appraisal<\/h2>\n

 <\/p>\n

\"Pros<\/a>

Pros and Cons of Bypassing an Appraisal<\/p><\/div>\n

Since mortgage giants Fannie Mae and Freddie Mac announced last year special rules for when a property does not need a traditional in-person appraisal, only about 5 percent of Fannie\u2019s 1.2 million home mortgages\u2014or 60,000\u2014have qualified, The Washington Post<\/em> reports. Freddie estimates that, eventually, no-appraisal mortgages will account for up to 15 percent of its new loans.<\/p>\n

In some transactions, Fannie and Freddie are relying on proprietary analytics and property data to value homes rather than sending an appraiser to inspect it. But not every buyer is eligible to bypass the in-person appraisal. Generally, banks collect a down payment of at least 20 percent, and then Fannie and Freddie identify which properties are eligible.<\/p>\n

\u201cIf [Fannie and Freddie] have a good basic inventory of information about the house, its value, and what it sold for, you\u2019re more apt to get a property inspection waiver,\u201d Don Frommeyer, a mortgage originator at Marine Bank in Indianapolis, told realtor.com\u00ae. However, \u201cthe longer it hasn\u2019t been appraised, the more apt you are not going to get a property inspection waiver.\u201d<\/p>\n

Bypassing the in-person appraisal could save home buyers money; the average cost of a traditional in-person appraisal is $500, according to Fannie. But real estate experts warn that even if they are eligible, home buyers may not want to bypass the appraisal. \u201cIt can save buyers money, but it can potentially lead to them overpaying if they don\u2019t have that second opinion in the appraisal,\u201d\u00a0says Danielle Hale, realtor.com\u00ae\u2019s chief economist. For example, if the appraisal comes in lower than a buyer\u2019s offer, the buyer may be able to renegotiate. \u201cBut many markets are so hot right now that buyers may not be able to negotiate the price anyway, even if an appraisal came back too low.\u201d<\/p>\n

For borrowers who are refinancing, they may find bypassing an appraisal worth it, Hale says. Some lenders may like the option, too. \u201cWe think it\u2019s great for borrowers,\u201d Mat Ishbia, president and CEO of United Wholesale Mortgage, told the Post<\/em>. It \u201csaves time and money\u201d and leads to shorter timelines for locking in interest rates and closing transactions. More than 10 percent of the lender\u2019s home loans are now appraisal-free, Ishbia says.<\/p>\n

But not all are convinced that no-appraisal loans are a good move for home buyers. Fannie and Freddie\u2019s computer programs \u201ccannot smell 20 cats living at the property,\u201d Ryan Lundquist, an appraiser based in Sacramento, Calif., told the Post<\/em>. \u201cThey won\u2019t be able to identify problems that could potentially lower the value of the home.\u201d<\/p>\n

Source: \u201cIn-Person Home Appraisals Won\u2019t Be Required for Some Loans: Should You Get One Anyway?<\/a>\u201d realtor.com\u00ae (May 18, 2018) and \u201cFannie and Freddie Approve Thousands of Loans With No Formal Appraisals<\/a>,\u201d The Washington Post (May 2, 2018)\u00a0\u00a0<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Pros and Cons of Bypassing an Appraisal   Since mortgage giants Fannie Mae and Freddie Mac announced last year special rules for when a property does not need a traditional in-person appraisal, only about 5 percent of Fannie\u2019s 1.2 million home mortgages\u2014or 60,000\u2014have qualified, The Washington Post reports. Freddie estimates that, eventually, no-appraisal mortgages will … <\/p>\n

Continue reading<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16,8],"tags":[5,32,4,9],"class_list":["post-13510","post","type-post","status-publish","format-standard","hentry","category-news","category-real-estate-tips","tag-anthony-didonato","tag-news","tag-real-estate","tag-tips","item-wrap"],"yoast_head":"\nPros and Cons of Bypassing an Appraisal - Real Estate Agent and Sales in PA - Anthony DiDonato Broomall, Media, Delaware County and surrounding areas in Pennsylvania<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.anthonydidonato.net\/wordpress\/pros-and-cons-of-bypassing-an-appraisal\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/pros-and-cons-of-bypassing-an-appraisal\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/pros-and-cons-of-bypassing-an-appraisal\\\/\"},\"author\":{\"name\":\"admin\",\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/#\\\/schema\\\/person\\\/964792b6994e8cc4cbddc36ad4824908\"},\"headline\":\"Pros and Cons of Bypassing an Appraisal\",\"datePublished\":\"2018-05-22T13:08:31+00:00\",\"dateModified\":\"2018-05-22T13:08:32+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/pros-and-cons-of-bypassing-an-appraisal\\\/\"},\"wordCount\":490,\"publisher\":{\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/#\\\/schema\\\/person\\\/964792b6994e8cc4cbddc36ad4824908\"},\"image\":{\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/pros-and-cons-of-bypassing-an-appraisal\\\/#primaryimage\"},\"thumbnailUrl\":\"http:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/wp-content\\\/uploads\\\/2018\\\/05\\\/05222018.jpg\",\"keywords\":[\"Anthony DiDonato\",\"News\",\"Real Estate\",\"tips\"],\"articleSection\":[\"News\",\"Real Estate Tips\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/pros-and-cons-of-bypassing-an-appraisal\\\/\",\"url\":\"https:\\\/\\\/www.anthonydidonato.net\\\/wordpress\\\/pros-and-cons-of-bypassing-an-appraisal\\\/\",\"name\":\"Pros and Cons of Bypassing an Appraisal - 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