Appraisal modernization is the process of using new valuation solutions, tools, and technologies to make mortgage origination more efficient. These tools may include desktop and hybrid appraisals, appraisal waiver programs, and more.

Appraisal management companies employing appraisal modernization tools may use new real estate valuation methods such as desktop appraisals or hybrid appraisals instead of traditional appraisals. Desktop appraisals allow an appraiser to use supporting data obtained from public data sources to identify property characteristics and condition to determine an opinion of value. Hybrid appraisals involve a property data collection during which a trained data collector visits the property to collect data that is used by an appraiser to determine an opinion of value.\

The government-sponsored enterprises, Fannie Mae and Freddie Mac, support appraisal modernization with inspection-based appraisal waiver programs like Fannie Mae’s Value Acceptance + Property Data and Freddie Mac’s ACE+ PDR (automated collateral evaluation and property data report). These programs allow lenders to skip the appraisal process for certain loans, which can reduce turn times and expedite collateral risk review efforts.