What Is a Desktop Appraisal
A desktop appraisal is exactly what it sounds like — an appraisal completed without the appraiser visiting your property. Instead of walking through your home and measuring rooms, the appraiser uses data from public records, MLS listings, photos, and other sources to determine your home's value.
The appraiser completes Form 1004 Desktop, which requires the same information as a traditional appraisal but gathers it differently. They might use virtual inspection methods like digital photos or videos you provide, machine-generated floor plans, or information from previous listings.
Say you're buying a home in a neighborhood with plenty of recent sales data and good public records. If Desktop Underwriter determines your loan has low risk, it might offer a desktop appraisal as one option. Your lender can then choose this faster, less expensive route instead of ordering a traditional appraisal.
When Desktop Appraisals Are Available
Desktop Underwriter decides whether your loan qualifies for a desktop appraisal. The system analyzes your entire loan profile — your credit, income, assets, and the property details — to determine risk level.
Your transaction must meet specific criteria. You need a single-family home (including those with accessory dwelling units) that you'll use as your primary residence. The loan-to-value ratio cannot exceed 90%. Only purchase transactions qualify, including new construction purchases.
DU must give your loan an "Approve/Eligible" recommendation. If you get "Approve/Ineligible" or any other recommendation, desktop appraisals are off the table.
Even if you qualify, your lender makes the final choice. DU typically provides multiple appraisal options — desktop, hybrid, or traditional. Your lender can pick any of these based on their own risk tolerance and business practices.
What Properties Cannot Use Desktop Appraisals
Several property types are automatically excluded from desktop appraisals. Two-to-four unit properties, condominiums, and co-ops cannot use this option. Manufactured homes are also ineligible.
All refinance transactions are excluded, regardless of the property type or your credit profile. This includes rate-and-term refinances and cash-out refinances.
Second homes and investment properties cannot use desktop appraisals. The property must be your primary residence.
Certain loan programs are also excluded. HomeReady loans, HomeStyle Renovation loans, and HomeStyle Refresh loans require traditional appraisals. Construction-to-permanent loans, whether single-close or two-close, need full appraisals.
Properties with resale restrictions face additional hurdles. Community land trusts, properties using the Affordable LTV feature, and Community Seconds with subsidized sales prices cannot use desktop appraisals.
How Appraisers Complete Desktop Appraisals
The appraiser gathers property information from multiple data sources rather than visiting the home. They can accept photos, floor plans, and property details from you, your real estate agent, or other parties with a financial interest in the transaction — but they must verify this information through independent sources.
Public records provide basic property details like square footage, lot size, and building permits. MLS data shows recent listing information and photos. The appraiser might also use virtual inspection tools or request specific photos from you.
The appraiser must determine that all information is accurate and reliable enough to produce a credible report. They cannot make "extraordinary assumptions" or complete the appraisal "subject to" verification of the property's condition.
Desktop appraisals require the same exhibits as traditional appraisals, plus a floor plan. The appraiser must identify the assignment type as "DesktopAppraisal" in the report and specify "Other" for the data collection method.
Your Lender's Responsibilities
Your lender bears significant responsibility for desktop appraisals. They remain responsible for the accuracy of all property data in the appraisal report, including condition and quality ratings.
The lender must ensure the property meets all Fannie Mae eligibility requirements outlined in the Selling Guide. This includes verifying that the property is suitable collateral for the loan amount.
All life-of-loan representations and warranties that apply to traditional appraisals also apply to desktop appraisals. Your lender cannot shift this responsibility to the appraiser just because they didn't physically inspect the property.
Collateral Underwriter Scoring and Warranty Relief
Desktop appraisals go through Collateral Underwriter (CU) scoring just like traditional appraisals. CU analyzes the appraisal data and assigns a risk score.
If your desktop appraisal receives a CU risk score of 2.5 or lower, your lender gets enforcement relief on certain representations and warranties related to property value. This provides some protection for lenders who choose desktop appraisals over traditional ones.
The warranty relief only applies to specific property value representations covered in [[A2-2-06]]. Other loan-level representations and warranties remain in full effect.
What Could Go Wrong
Desktop appraisals work best when public records are accurate and recent comparable sales exist in your area. If your property has unique features not captured in public records, or if you've made significant improvements not reflected in tax assessments, a desktop appraisal might miss important value factors.
Properties in rapidly changing markets or areas with few recent sales present challenges. The appraiser has less data to work with and may struggle to capture current market conditions without seeing the property firsthand.
If the desktop appraisal comes in lower than expected, you have the same options as with any appraisal — request a reconsideration of value with additional supporting data, or ask your lender to order a traditional appraisal instead.
Remember that even if DU offers a desktop appraisal option, your lender might choose a traditional appraisal anyway. Some lenders prefer the certainty that comes with physical property inspection, especially for higher loan amounts or in volatile markets.
References
For the official guidelines, see B4-1.2-02: Desktop Appraisals in the Fannie Mae Selling Guide.
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Original Fannie Mae Guideline Text
B4-1.2-02, Desktop Appraisals (12/10/2025)
Representations and Warranties
Uniform Appraisal Dataset (UAD) 3.6 Policy
Overview
For certain loan casefiles, DU offers desktop appraisals. A desktop appraisal reported on the Uniform Residential Appraisal Report (Desktop) (Form 1004 Desktop) is permitted for certain transactions. The minimum scope of work for Form 1004 Desktop does not include a current inspection of the subject property or comparable sales by the appraiser; the appraiser relies on data obtained from alternative methods or sources to identify property characteristics and condition.
Completing the Form 1004 Desktop
Subject property information may be obtained from one or more data sources. The appraiser can accept data, photos, floor plans, and other information from a party who has a financial interest in the sale or financing of the property if the appraiser verifies such data from a disinterested source. The appraiser must determine if the information is accurate and reliable to produce a credible report, which includes the features, quality, and condition of the subject property.
Virtual inspection methods (including digital photos or videos) or other technological solutions (such as a machine-generated floor plan) can augment the data and imagery used for a desktop appraisal. Information provided by the homeowner, potential borrower, or a third party can be used to develop the description of the interior and exterior of the improvements. Extraordinary assumption(s) or appraisals made "subject to" verification of the subject property's condition, quality, or physical characteristics are not permitted.
The lender remains responsible for the description of the property, and the accuracy and of all data on the appraisal that pertains to the property. This includes the property's condition and quality ratings. The lender is also responsible for ensuring the property meets the property eligibility requirements in this Selling Guide. Lastly, the lender remains responsible for any life-of-loan representations and warranties that may apply to the property or the appraisal.
Exhibits: Form 1004 Desktop requires the same exhibits as traditional appraisals, plus a floor plan. The Square Footage-Method for Calculating: ANSI Z765-2021 standard is not required for desktop appraisals but encouraged when feasible. See B4-1.2-01, Appraisal Report Forms and Exhibits for additional information.
Entry of Appraisal Assignment Type: The appraiser must provide the Appraisal Assignment Type and supporting details (located in the Additional Comments section of the appraisal report) as shown in the following table.
"DesktopAppraisal"
"Other"
Null
DU Messaging: For loan casefiles that are eligible for a desktop appraisal option, DU will issue a message informing the lender they can choose to obtain an appraisal reported on Form 1004 Desktop. DU will also issue messages for other appraisal options. The lender may select from any of the options presented, which may include a desktop appraisal, hybrid appraisal, or traditional appraisal.
Eligible Transactions
To be eligible for a desktop appraisal, transactions must meet the following criteria:
one-unit property (including those with an ADU and units in a PUD),
principal residence,
purchase transaction (including new construction),
LTV ratio less than or equal to 90%, and
DU loan casefile that receives an Approve/Eligible recommendation.
Ineligible Transactions
The following transactions are not eligible for a desktop appraisal:
two- to four-unit properties;
condo and co-op units;
manufactured homes;
construction-to-permanent loans (single-close and two-close);
second homes and investment properties;
all refinances;
HomeReady, HomeStyle Renovation, and HomeStyle Refresh loans;
Community Seconds with a subsidized sales price;
community land trusts, or other properties with resale price restrictions, which include loan casefiles using the Affordable LTV feature;
DU loan casefiles that receive an Ineligible recommendation; and
manually underwritten loans.
Representations and Warranties
When a desktop appraisal is reported on Form 1004 Desktop and submitted through the UCDP, the appraisal will be scored by Collateral Underwriter (CU). All eligible loans with a desktop appraisal that receive a CU risk score of 2.5 or less are eligible for enforcement relief of certain representations and warranties related to the appraisal value of the subject property (see A2-2-06, Representations and Warranties on Property Value for complete requirements and additional information).
Uniform Appraisal Dataset (UAD) 3.6 Policy
Lenders using UAD 3.6 must follow the requirements in the UAD 3.6 Policy Supplement .
