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Drive-By Appraisal: Defined And Explained

March 11, 2024 5-minute read

Author: Molly Grace


When most people hear the word “appraisal,” they likely think of the classic definition: a stranger comes into your home and walks around for a bit, taking notes as they closely inspect every part, inside and out.

By contrast, a drive-by appraisal might seem shockingly or even recklessly casual. But – as we’ve seen during COVID-19 – drive-by appraisals can be very useful and can provide a good estimate of a property’s value in situations where a traditional appraisal isn’t needed or isn’t possible.

What Is A Drive-By Appraisal?

A drive-by appraisal, also referred to as a summary appraisal, is an alternative form of home appraisal. Instead of inspecting both the interior and exterior, the appraiser only needs to examine the exterior of the property and any available real estate records to determine the home’s value.

Because they aren’t entering the home, the appraiser will rely more heavily on other data points to help them accurately determine the home’s market value. This may include doing additional research and going through public records to learn as much as possible about the home.

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How Does A Drive-By Appraisal Work?

Though the name might imply minimal effort, professional appraisers completing a drive-by appraisal are required to follow certain standards and use all the information at their disposal to create a report that is as close to a traditional appraisal as possible.

A drive-by appraisal involves the appraiser physically visiting the home in question and taking detailed notes and photographs of the condition and features of the exterior of the property. They’ll also look for homes in the neighborhood that are similar to the property to use as comparable sales (also known as comps) and do a drive-by inspection of them as well.

Comps are recently sold homes that are similar to the subject property in location and physical characteristics. Comps are used to help determine the market value of a home, because similar homes in the same area tend to have comparable market values.


They’ll also look for the characteristics of the neighborhood, such as its environmental conditions, including those that could adversely affect property values.

The exterior inspection of a home is only a small part of a drive-by appraisal. Appraisers must also do sufficient research to learn enough about the home to form an opinion of its value.

Appraisers may use things like MLS listings, tax records, public records or information provided by the homeowner to learn as much as possible about the features and condition of the interior of the home.

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When Is A Drive-By Appraisal A Good Option?

Using an appraisal to determine the market value of a home is vital for lenders, who want to make sure they aren’t lending more than what the property is worth and increasing their risk.

Because they aren’t as precise as traditional appraisals, most mortgage lenders won’t allow for drive-by appraisals on purchase or refinance transactions unless there are extenuating circumstances (such as a policy change due to pandemic-related shutdowns).

When can a drive-by appraisal be used? A mortgage lender might order a drive-by appraisal on a home that is at risk of foreclosure. Lenders may also use drive-by appraisals for home equity loans or home equity lines of credit.

During COVID-19, many mortgage investors and insurers – including Fannie Mae, Freddie Mac and the FHA – have amended their rules to allow for drive-by appraisals on home purchases and refinances when other types of appraisals aren’t allowed or advised.

Drive-by appraisals can also benefit property sellers that may have concerns about the interior of their home meeting the desired valuation, due to issues with the home or property record inaccuracies. Because drive-by appraisals only focus on the exterior of a home, there is no appraiser going inside of the home to view these concerns that could affect the value of the home.

What Are The Pros And Cons?

Let’s take a look at the good, the bad and the ugly of drive-by appraisals.

Drive-By Appraisal Advantages

  • Cost. Drive-by appraisals are cheaper than traditional appraisals, which can typically cost $300 – $400.
  • Convenience. Because an appraiser isn’t entering the home, these types of appraisals are more convenient for homeowners, who don’t have to worry about prepping their home or planning their schedule around the appraisal appointment.

Drive-By Appraisal Disadvantages

  • Less accurate. No matter how much research an appraiser does, it’s hard to make up for the fact that they aren’t viewing the interior of the home themselves.
  • It’s easier to miss interior issues. Damage, disrepair, mold or other problems can be easy to miss if you’re only going off of public records and homeowner-provided information.
  • Data may be outdated. A potential pitfall of using publicly available data to evaluate a home is that the data may be outdated or inaccurate.

Are Drive-By Appraisals FHA-Approved?

The FHA is currently accepting drive-by appraisals for FHA loans to meet COVID-19 regulations. Like other major mortgage backers, the FHA loosened their appraisal requirements, allowing drive-by appraisals when more thorough appraisal types can’t be completed.

What Other Alternative Appraisal Options Are There?

In addition to traditional appraisals and drive-by appraisals (also known as exterior-only appraisals), you may have heard of a couple other types of appraisals.

  • Desktop appraisal. A desktop appraisal is completed without physically inspecting the property and are most commonly used when a buyer has an appraisal waiver. These appraisals will use the same type of information used during the research part of a drive-by appraisal – public records, MLS information, photos, comps and the like. Based on this research, they’ll come up with an estimate of the home’s value. Rocket Mortgage® doesn’t offer desktop appraisals at this time.
  • Hybrid appraisal. A hybrid appraisal, also known as a bifurcated appraisal, splits the appraisal process into two parts, which are completed by two different parties. When a licensed appraiser completes a hybrid appraisal, they’ll be responsible for gathering the relevant data (including public record data, MLS information and comps) and ultimately creating an opinion of the property’s value. But instead of visiting the property themselves, they’ll enlist a third party, who may or may not be a professional appraiser, to physically inspect the property. The appraiser will use this person’s findings to help create the appraisal report.

The Bottom Line

Though the phrase “drive-by appraisal” might inspire panic in homeowners who want to be sure their home is being properly evaluated, the truth is that drive-by appraisals are only used in a limited number of circumstances, and when they are, appraisers work hard to ensure they’re getting enough information to evaluate the worth of the home as accurately as possible.

If you’re considering buying a home or refinancing your mortgage, you can get started online with Rocket Mortgage®.

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Molly Grace Writer Headshot

Molly Grace

Molly Grace is a staff writer focusing on mortgages, personal finance and homeownership. She has a B.A. in journalism from Indiana University. You can follow her on Twitter @themollygrace.