Starting March 22, 2025, Fannie Mae is taking a bold step forward by expanding hybrid appraisal options, a move that will significantly impact appraisers, lenders, and appraisal management companies (AMCs).

For appraisers, this means a shift in how valuations are conducted. For lenders, it means streamlined processes and improved loan cycle efficiency. And for AMCs, it presents an opportunity to enhance service offerings while maintaining compliance with Fannie Mae’s evolving requirements.

But what exactly does this change entail, and how should you prepare?

How Hybrid Appraisals Work: A Faster, Scalable Approach to Property Valuations

Hybrid appraisals leverage a two-step process to improve speed and scalability:

Property Data Collection – A trained third party (such as an inspector or real estate professional) gathers property details, including photos and measurements.
Appraiser Analysis & Final Report – A licensed appraiser then completes the valuation remotely using the collected data, ensuring accuracy and compliance with industry standards.

This model reduces the time appraisers spend in the field while maintaining valuation integrity—helping them handle more assignments efficiently.

For lenders, faster appraisals translate to quicker loan approvals and reduced closing times, a critical advantage in today’s fast-paced market.

The Impact of Hybrid Appraisals on Appraisers, Lenders & AMCs

With traditional appraisal turnaround times often delayed due to limited appraiser availability, hybrid appraisals offer a practical solution with several key benefits:

Increased Capacity – Appraisers can complete more reports without the constraints of scheduling on-site inspections.
Faster Loan Processing – Lenders can expedite underwriting decisions with quicker valuation turnarounds.
Adaptability to Market Changes – A flexible appraisal model that aligns with evolving industry needs and technology.
Regulatory Compliance – By working within Fannie Mae’s framework, lenders and AMCs can ensure they remain aligned with GSE requirements.

However, this shift also comes with new challenges:
🔹 Appraisers must adjust to analyzing third-party data.
🔹 Lenders need to ensure their AMCs are equipped for this transition.
🔹 AMCs must streamline workflows to support both parties effectively.

How to Prepare for Fannie Mae’s Hybrid Appraisal Expansion

With Fannie Mae’s expansion of hybrid appraisals, now is the time to adapt and stay ahead. Whether you’re an appraiser, lender, or AMC, preparation is key:

Understand the new process – Familiarize yourself with Fannie Mae’s updated guidelines to ensure compliance.
Leverage technology – Using a customizable appraisal management platform like Connexions can help you seamlessly integrate hybrid appraisal workflows.
Optimize operations – Lenders and AMCs should ensure they have the right technology and partnerships to support hybrid appraisals efficiently.

The Future of Appraisals: Are You Ready for the Hybrid Model?

Fannie Mae’s hybrid appraisal expansion isn’t just a minor update—it’s a major industry shift. Those who embrace this change have the potential to increase efficiency, scale operations, and stay competitive.

At Connexions, we provide flexible, cutting-edge appraisal management solutions designed to help lenders, AMCs, and appraisers stay ahead of industry shifts like this one.

Get a Demo Today – See how Connexions can support your hybrid appraisal strategy.