Don't risk your home with a Property Inspection WaiverIf you're getting a loan for a home, your lender might give you the option to use a Property Inspection Waiver (PIW) on your loan application. The program, started by Fannie Mae in 2017, allows you to be approved for a mortgage without an appraisal. It's a relatively new concept, and some lenders love it. But what prompted it, and what risks are associated? 
How does a Property Inspection Waiver work?Essentially, the value of your home is determined by your lender. They determine its value automatically on a computer, employing a database from Fannie Mae rather than hiring a local appraiser to personally inspect the home you're getting ready to buy. So, rather than a hands-on evaluation, lenders rely on computer processes to sort through a bank of previously collected information. Get your appraisal from Tampa Bay Valuations, LLC. today Get a quote nowWho's eligible for a PIW?The program's currently limited, but it's including more transaction types continuously. Your home has to have records in Fannie Mae's electronic database, so homes that have never been appraised aren't eligible for a PIW. Additionally, you're required to have an excellent credit score and high assets to be approved. Why is it applied?The waiver eliminates appraisal fees, and it can reduce closing time substantially for buyers. At first glance, this process sounds like a bargain — but there's a crucial point you will want to consider. With a PIW, your lender is NOT liable if the assessment is wrong. That's great for lenders, but offers zero protection to the home buyer whatsoever. Is there anything that could go wrong?The information in Fannie Mae's database is derived from past appraisal reports completed by professional appraisers. it might be accurate to a degree, but by definition, it will not be an up-to-date assessment of the exterior and interior quality in a building that changes from year to year. Without a professional appraisal of your home, new improvements, renovations, or damages can absolutely be neglected by the system. Due to these deficiencies, you can imagine a scenario where your home is valued too high by the system assessing it. If that happens, you could run into snags when it's time to put it back on the market. You could wind up settling for less than you paid, and you'll have no recourse against your lender when the money starts adding up. What's the bottom line?A definitive appraisal typically costs a few hundred dollars, but it can save you a great deal more in the future. With a PIW, there is absolutely no guarantee you're getting an honest valuation of a premium asset. Tampa Bay Valuations, LLC. can help. Buying or refinancing a house is a big decision with big consequences. You should know without a doubt that you're getting a fair deal, and working with a licensed appraiser is the safest move you can make. Computers and algorithms are in nearly every area of modern life, but when it comes to measuring the value of your home, nothing is more accurate than the careful assessment of a licensed professional you trust. |