The Quick Read: It depends on your loan program, what an automated underwriting system says about your file, and the health of your building. Owning a condo does not decide it. An existing FHA or VA loan may skip the appraisal through a streamline, and some conventional loans can use an estimated value instead. A lender can still order an appraisal anyway.
Key Takeaways
- The condo itself is not the deciding factor. The loan program, the transaction type, and the building’s status are.
- You cannot request an appraisal waiver. The underwriting system and the lender decide.
- A waiver offer is not a guarantee. It can expire or disappear if the file changes.
- Skipping the unit appraisal does not skip the review of the building.
- FHA Streamline and VA IRRRL loans are the cleanest no-appraisal paths, but only for existing FHA or VA loans.
Why a Condo Refinance Works Differently From a House Refinance
A house refinance asks one main question: is the property worth enough to support the new loan? A condo adds a second question: is the building itself sound?
Refinance savings and break-even estimate
The starting figures are an example value with a balance in proportion and a placeholder for costs. Replace them with yours, and enter the current rate from your statement.
Editable benchmark: 7.32% as of October 22, 2026 · Freddie Mac 30-year average via FRED®. A conventional market reference, not a refinance quote.
Illustrative starting assumptions: a $350,000 home value, a $245,000 current balance, a current rate you enter and a remaining term seeded at twenty-five years, closing costs seeded at $5,000 as an editable placeholder (not a fee quote) and rolled into the new loan, a thirty-year term at the current Freddie Mac benchmark, and property taxes and insurance estimated at typical national rates. Every field is editable.
Illustrative estimate only — not a Loan Estimate, approval, quote, or commitment to lend. The new rate field carries the weekly Freddie Mac thirty-year conventional benchmark, a market reference and not a refinance quote; a refinance is priced by the lender at lock, and the current rate, the remaining term and the closing costs are figures you enter. The current payment is estimated from the balance, the current rate and the remaining term; the break-even divides the closing costs by the monthly saving and ignores the interest effect of a longer term. On the VA IRRRL the funding fee is added to the loan unless the veteran is exempt. Taxes and insurance are editable estimates. Licensed in sixteen states for consumer mortgages; Lendmire is a broker, never the lender.
Think of three layers. The unit is your home. The project is the building and the homeowners' association (HOA) that runs it. The borrower is you, with your credit, income, and reserves. A lender checks all three.
An appraisal speaks to the first layer. It estimates what your unit is worth. It does not, by itself, tell the lender whether the HOA is financially healthy or whether the building has big repairs coming. That is why a condo can be waived on valuation and still get a close look at the project.
Here are the two gates side by side.
| Gate | Who checks | What is checked | Does a waiver skip it? |
|---|---|---|---|
| Unit valuation | Underwriting system and lender | Estimated value of your unit | Yes, if offered |
| Project review | Lender | Whether the building is eligible | No |
What Is an Appraisal Waiver, Exactly?
An appraisal waiver is an offer from an automated underwriting system to accept a stated value without a full appraisal. Fannie Mae now calls its version "value acceptance." Older articles and some lenders still use "appraisal waiver." It is the same idea under a renamed term.
Per Fannie Mae's value acceptance page, the program lets a lender submit a property value in Desktop Underwriter with no appraisal requirement on eligible transactions. For a refinance, that submitted value is the lender's or borrower's estimate. Eligible properties include one-unit homes, and that includes condominiums.
Freddie Mac has a parallel tool called Automated Collateral Evaluation, or ACE, inside its Loan Product Advisor system. Per Freddie Mac's ACE page, lenders submit the loan before ordering an appraisal and read the system's feedback to see if the loan is ACE-eligible. Freddie extended this to condo refinances years ago. Condos are not a new or shaky category.
Here is the part that surprises people. You do not ask for this. The system compares your property and loan against a large database of past appraisals and public records. If it likes what it sees, it issues an offer. If not, an appraisal gets ordered.
How the Process Runs, Step by Step
This is the order of events on a typical conventional condo refinance.
1. Application and estimate. You or the lender provide an estimated value. The loan data goes into the automated system.
2. The system decides. It either returns a no-appraisal offer or it does not. No offer means a traditional appraisal.
3. The condo project check. Even with an offer, the lender must confirm the building is not ineligible in Fannie Mae's condo project tool. Some project types stay ineligible no matter what, such as condo hotels and timeshare-style projects.
4. Other rules still apply. The limited cash-out and cash-out rules still apply when a lender uses the offer. A property listed for sale is a problem.
5. Valuation copy. If any appraisal or other written valuation is developed, you are entitled to a copy. The lender must tell you about that right shortly after you apply.
6. Expiry. A Fannie Mae offer cannot be used if it is more than four months old on the note date. A delayed closing can bring the appraisal back.
Per the Fannie Mae Selling Guide, a lender may use value acceptance only when the final underwriting run produced an offer and no appraisal was obtained. If an appraisal gets ordered, the offer cannot be used.
When a Condo Refinance Needs an Appraisal
Expect an appraisal in these situations. Across the wholesale programs placed with lenders, these are the most common triggers.
No offer from the system. If the model cannot support your value, the lender orders a full appraisal. Thin comparable sales in a small building can cause this.
Cash-out beyond what the program allows. Taking cash out narrows value acceptance sharply. Fannie Mae's page allows limited cash-out refinances on principal residences up to 90% LTV/CLTV, but cash-out refinances on principal residences only up to 70%. LTV means loan-to-value, the loan balance as a share of the home's value. CLTV adds any second loans. Those are the ceilings for skipping the appraisal. They are not the ceilings for the loan itself, which are higher and covered below. Final terms depend on lender guidelines, property type, leverage, and the borrower's complete credit picture.
Government loans that are not streamlines. An FHA rate-and-term or cash-out refinance needs an appraisal. So does a VA cash-out refinance. The streamline shortcuts only apply to existing FHA and VA loans.
A building red flag. Fannie Mae guidance says a lender may decline to use value acceptance if it believes an appraisal is warranted based on additional information. Large special assessments or critical repairs are the examples. The critical-repairs review applies to condo projects of eleven or more attached units, and to projects of five to ten attached units that are part of a larger development or master association. It does not apply to detached condo units.
Lender judgment. An agency "no appraisal" rule is not a promise from any given lender. Lenders can order one anyway.
When a Condo Refinance Can Skip One
There are three routes.
Conventional value acceptance. This is the offer described above. It works best on a rate-and-term refinance with healthy equity on a principal residence.
FHA Streamline. If your current loan is FHA-insured, a streamline refinances it with limited credit review and no appraisal. A lender looks for a net tangible benefit, meaning the refinance must help you in a measurable way. Streamlines work only on existing FHA loans. If a condo project lost FHA approval, an FHA-to-FHA streamline has historically been the path that still worked without an appraisal. Confirm that against current HUD guidance, because condo rules shift.
VA IRRRL. The Interest Rate Reduction Refinance Loan is for existing VA loans. VA states that no appraisal or credit underwriting package is required when applying. Across the wholesale programs we place, the IRRRL carries a 0.5% funding fee unless you are exempt, requires a net tangible benefit, and has seasoning of the later of 210 days and 6 payments. It has no cash out. No lender is required to offer an IRRRL, so availability varies.
A cost note, kept mechanical: VA says an IRRRL can be done with no money out of pocket by rolling costs into the new loan or by taking a higher rate so the lender covers costs. Either way the cost does not vanish. It moves into your balance or your payment.
The Rate-and-Term Envelope You Are Working In
When you do get an appraisal or an accepted value, these are the program limits for a conventional rate-and-term refinance, subject to lender guidelines and full file review.
- Leverage: up to 95% LTV on a one-unit principal residence. It can reach 97% where the existing loan is agency-owned and the first-time-buyer program allows.
- What the loan can pay: the existing first mortgage, closing costs, and a purchase-money second lien, with only incidental cash back.
- Mortgage insurance: required above 80% LTV. You can ask to cancel it at 80% of the original value with good payment history, no subordinate liens, and no decline in value. The servicer must end it automatically at 78%.
- FHA rate-and-term: 97.75% with an appraisal.
- Credit: wholesale conventional programs start at a 620 decision score, with the automated finding governing most files.
If you want cash out of a condo instead, the conventional ceiling is 80% LTV on a one-unit principal residence. The first mortgage being paid off must be at least 12 months old, and you need to have been on title for 6 months. Occupancy matters too. A second-home or rental condo gets lower leverage than the home you live in. These specifics are subject to lender guidelines and a full review of property, leverage, and credit.
Who Decides, and Why "Eligible" Is Not "Approved"
Three parties influence the outcome: the program, the automated system, and the lender. Each can narrow the path but none can widen it past the one before.
The program sets the outer limits. The system issues or withholds the offer. The lender applies its own overlays on top. So a file can be eligible under agency rules and still get an appraisal because a lender prefers one.
That is why Fannie Mae frames the offer as something its system issues, not something a borrower requests. It is also why you should treat any early talk of a waiver as a possibility, not a promise.
A waiver offer is not a guarantee. It can expire, and it can be lost if the loan characteristics change.
Five Quick Scenarios
These use percentages and plain words only. Each is a pattern, not a prediction.
Rate-and-term, strong equity. A homeowner refinances a condo they live in, owes well under the home's value, and has no special assessments in the building. This is the profile where an offer is most plausible. The lender still checks the project.
Cash-out on a condo. Taking cash out cuts the share of value that can be accepted without an appraisal. An appraisal is likely.
Existing FHA loan. A condo owner with an FHA mortgage wants a lower payment. An FHA Streamline skips the appraisal and uses limited credit review. The building's FHA project status matters less here, since an FHA-to-FHA streamline does not require the condo questionnaire.
Unresolved HOA problem. The building has a big special assessment or serious deferred repairs. Even with a clean model result, a lender may order an appraisal to judge marketability.
Second home or rental condo. Occupancy decides leverage. Non-owner-occupied condos face lower ceilings and tighter limits, so an appraisal is more likely.
If the Appraisal Comes In Low
Condo values depend heavily on recent sales inside your own building. If the number lands below what you expected, ask your lender about a reconsideration of value. Bring comparable sales from the same building, especially recent ones with similar floor plans, views, and condition.
You have options beyond arguing. You can bring cash to the table, restructure the loan, or wait. For a related situation on the investor side of the table, Lendmire's piece How to Respond When a Rental Cash-Out Refinance Appraisal Comes In Low walks through the same reconsideration steps, though the loan type differs.
Costs and Timing, Without the Hype
Skipping an appraisal removes that fee. Freddie Mac says borrowers can skip the appraisal fee and save money, and it describes ACE refinances as less time-consuming at the valuation step. Treat both as general statements, not promises for your file, since costs vary by file and lender.
The budget effect is real but limited. You pay less upfront and wait less for a valuation. It does not change the price of the loan itself. And with no appraisal, nobody independently inspects the home's condition. That is a tradeoff, not a flaw.
If you are exploring options, Lendmire's refinance programs cover conventional, FHA, VA, and jumbo paths, arranged through wholesale lenders in the 16 states where Lendmire is licensed for consumer lending.
Questions to Ask Your Lender
- Will you submit my file for value acceptance or ACE before ordering an appraisal?
- If I get an offer, is there anything about my building that could still trigger an appraisal?
- How old can the offer be at closing?
- Do you have overlays that make you order appraisals on condos anyway?
- If the project is flagged, what documents do you need from my HOA?
- If I am on an FHA or VA loan, is a streamline available through you?
Gather your HOA contact, recent budget and any special assessment notices, your current mortgage statement, and your insurance details before you apply.
Key Terms Defined
Value acceptance: Fannie Mae's name for accepting a stated property value without a full appraisal on eligible loans.
ACE (Automated Collateral Evaluation): Freddie Mac's tool that lets eligible loans go forward without an appraisal.
Warrantable condo: a building that meets agency rules for financial health, ownership mix, insurance, and limits on commercial space.
Special assessment: an extra charge the HOA bills owners, often to pay for major repairs.
Streamline refinance: a simplified refinance of an existing FHA or VA loan with limited underwriting and no appraisal.
Net tangible benefit: a measurable improvement the refinance must give you, such as a lower payment or a more stable loan.
Frequently Asked Questions
Can I ask my lender for an appraisal waiver on my condo?
No. The automated underwriting system issues the offer, and the lender decides whether to use it. You can ask whether your file will be submitted for one, but you cannot force it.
Are condos eligible for appraisal waivers at all?
Yes. Both Fannie Mae and Freddie Mac allow it for one-unit condos on eligible transactions. Freddie Mac extended its tool to condo refinances in 2018, and Fannie Mae added condos to value acceptance in 2024.
If I skip the appraisal, does the lender skip reviewing my building?
No. The lender must still confirm the condo project is not ineligible. Large special assessments or critical repairs can also lead to an appraisal being ordered.
Does a streamline refinance work on any condo loan?
No. FHA Streamline requires an existing FHA loan, and the VA IRRRL requires an existing VA loan. A conventional loan has no streamline of that kind.
Does the CFPB require an appraisal on every refinance?
No. The federal rule governs notices and copies of any valuation, not whether one is required. If a lender develops an appraisal or other written valuation, you are entitled to a copy.
If you are weighing a refinance and want the break-even run on your own numbers, Lendmire can help you compare the programs on the same home. Reach the team at 828-256-2183. Program details are subject to lender guidelines and full file review, and nothing here is a commitment to lend.
For your own numbers, request a scenario review with Lendmire.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker licensed for consumer lending in 16 states. Lendmire arranges FHA, VA, conventional and jumbo purchase and refinance loans through wholesale lenders; every file is underwritten by the lender under the applicable program guidelines. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
Get Started
Ready to find the right loan for you?
In about 30 seconds you can review financing options available for your home or investment property. No commitment required.
Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. Fannie Mae — Value Acceptance
2. Freddie Mac — Automated Collateral Evaluation
3. Fannie Mae Selling Guide B4-1.4-10, Value Acceptance
5. Fannie Mae FAQs: Property Valuation
This article is part of Lendmire’s Refinance series — every loan program’s qualification details, guidelines, and scenarios live on the loan options page.
Related reading: How the Appraisal Works on a Cash-Out Refinance · Smaller Cash-Out Refinance Now vs Waiting for a Higher Appraisal · Should You Refinance Before Your ARM Adjusts If You May Sell?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.