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Beyond Terminology: What Fannie Mae’s Selling Guide Updates Mean for Appraisers

by Scott DiBiasio, Director of Government Affairs, Appraisal Institute

Fannie Mae recently issued important updates to its Selling Guide that may look like technical revisions but have significant implications for appraisers, consumers, and the valuation profession. The most visible changes involve the retirement of the term “appraisal waiver” in favor of “value acceptance” and adjustments to the Reconsideration of Value (ROV) process. Together, these changes reflect the GSEs’ modernization priorities—but also highlight the ongoing tension between efficiency and transparency.

From “Appraisal Waiver” to “Value Acceptance”
Fannie Mae has decided to eliminate the term “appraisal waiver” from the Selling Guide, replacing it entirely with “value acceptance.” Even the parenthetical “(appraisal waiver)” has been removed. The stated goal is to unify industry language and create consistency across the valuation spectrum.

That may sound harmless, but let’s be clear: the average consumer is not going to recognize that “value acceptance” means their lender has waived an appraisal altogether. That lack of clarity undermines transparency at a critical stage of the lending process.

The Appraisal Institute (AI) will absolutely continue to call these products what they are: appraisal waivers. Language matters. Consumers and appraisers alike deserve accuracy, not euphemisms, when it comes to understanding whether an independent appraisal has been performed.

Reconsideration of Value: Streamlining vs. Transparency
The Selling Guide changes also revise handling ROVs. Two elements stand out:

1. The initial disclosure of ROV rights at loan application has been eliminated.
2. Borrowers will now receive disclosure only when the appraisal report is delivered.

Documentation requirements have also been pared back so that lenders need only retain outcome-related records, not initiation documents.

Simplification may reduce lender burden, but the initial notice had value. A better approach would be to notify consumers up front that, if an appraisal is required, they will receive it at least three days before closing, along with clear notice of their ROV rights. That’s the point in the process when the information is most relevant and when borrowers still have time to act.

Waiver Expansion + Borrower Impact
The terminology shift comes against the backdrop of steadily expanding waiver eligibility. Both Fannie Mae and Freddie Mac now allow appraisal waivers on purchase loans up to 90 percent LTV, and on loans up to 97 percent LTV when combined with property data collection.

Since 2020, appraisal waivers have saved borrowers more than $2.5 billion in fees. And while actual usage remains modest—just one to two percent of loans in early 2025—the trajectory is clear: appraisal alternatives are here to stay, and their footprint is growing.

For consumers, that may mean lower costs and faster turn times. For appraisers, it reinforces the need to pivot away from being seen only as data gatherers and toward being recognized as indispensable analysts of complex valuation problems.

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The Rise of Property Data and Hybrid Models
A related development is the increasing use of Uniform Property Dataset (UPD) collections. These involve trained data collectors compiling photos, floor plans, and other property details for lender submission. When paired with automated risk models, UPDs often allow lenders to bypass a full appraisal—or to commission a hybrid appraisal in which the appraiser focuses on analysis rather than inspection.

UPDs and hybrids are attractive to lenders because they are cheaper and faster than traditional appraisals. But their growth raises important questions about independence, accountability, and quality.

For appraisers, these models represent both a challenge and an opportunity. The challenge is adapting to a reduced role in property inspection. The opportunity is to demonstrate the analytical expertise that neither algorithms nor third-party data collectors can provide.

Why This Matters for Appraisers
Taken together, the Selling Guide updates and the expansion of waiver-based models point to several key takeaways:

1. Language shapes perception. If consumers don’t recognize that value acceptance is an appraisal waiver, transparency suffers. That’s why AI will continue to call these products by their true name.
2. Efficiency is not clarity. Simplifying disclosures may ease compliance for lenders, but it risks reducing borrower awareness of their rights.
3. Modernization is accelerating. With waivers, UPDs, and hybrid appraisals expanding, appraisers must adapt their skills to remain at the center of the valuation process.
4. Incursion is real. Regulators, property data collectors, and third-party vendors are positioning themselves between appraisers and their clients. The profession cannot afford to cede ground.

Equipping Yourself for the Future
Adapting to these developments requires more than awareness; it requires preparation. The Appraisal Institute is committed to providing appraisers with the tools they need to succeed through a new series of companion courses to the Uniform Residential Appraisal Report (URAR) and UAD 3.6:

• Supporting Adjustments and Reporting the Sales Comparison Approach (3 hours)—Explore real-world case studies to support adjustments and strengthen reconciliation.
• Reporting Market Analysis and Better Understanding the New URAR (4 hours)—Learn how to integrate robust market analysis into your reports while meeting evolving GSE compliance requirements.

These programs are designed to ensure appraisers are not only compliant with modernization requirements but also positioned as leaders in the valuation space.

Conclusion
Fannie Mae’s Selling Guide updates are about more than wordsmithing. They reflect the broader recalibration of valuation in the mortgage process: a shift toward efficiency and data that risks reducing clarity for consumers.

As professional advocates for appraisers, we will continue to call appraisal waivers what they are. We will continue to push for transparency in borrower disclosures. And we will continue to fight against incursion into the profession by regulators, property data collectors, and other third parties who seek to diminish the role of the independent appraiser.

Modernization is not the end of the appraisal profession. It is the next chapter. With the right tools, training, and a strong voice for advocacy, appraisers can shape that chapter for the better — ensuring both the strength of our profession and the protection of the public trust.

About the Author
Scott W. DiBiasio is the Director of Government Relations for the Appraisal Institute, where he leads federal, state, and local advocacy efforts on real estate valuation and housing finance issues. He oversees the team that works with Congress, federal agencies, state legislatures, and appraisal boards, managing advocacy strategies, grassroots engagement, and policy development. With extensive legislative and regulatory experience, he is dedicated to protecting the integrity of the appraiser licensing system and advancing professional standards in the valuation profession.

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