In a competitive North Texas market—especially in Frisco, Prosper, McKinney, Celina, Plano, and Little Elm—appraisal waivers are one of the biggest tools buyers use to strengthen their offers.
But waivers also create confusion.
When should you use one?
What’s the difference between a full appraisal waiver and a partial appraisal waiver?
How do they affect your risk and your cash-to-close?
When I represent buyers, I break down each option clearly and help you understand exactly what you’re agreeing to before we ever submit an offer.
Here’s your complete guide.
1. First—What Is an Appraisal Waiver?
An appraisal waiver changes what happens if the home does not appraise for the contract price.
Normally, if a home appraises low:
✔️ The lender lends based on appraised value, not price
✔️ The buyer can renegotiate or terminate (if no waiver is in place)
Appraisal waivers remove or reduce this protection.
2. Full Appraisal Waiver (Most Risk, Strongest for Sellers)
A full waiver is the most aggressive option.
✔️ Buyer agrees to pay the full contract price even if the home appraises lower
✔️ Buyer cannot back out due to low appraisal
✔️ Buyer must bring the entire appraisal gap in cash
Example:
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Contract: $600,000
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Appraisal: $540,000
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Gap: $60,000
With a full waiver:
➤ You must bring the $60,000 difference to closing.
Termination is not allowed based on the appraisal.
Best used when:
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The home is a must-have
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Competition is extremely strong
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You have significant cash reserves
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The neighborhood is appreciating fast
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The listing appears underpriced intentionally
I only recommend this when your financial position comfortably supports it.
3. Partial Appraisal Waiver (Balanced, Safer, and Very Common)
This is the option I use most often with buyers.
With a partial waiver:
✔️ You commit to covering some of the gap
✔️ BUT—not the entire gap
✔️ If the appraisal comes in below your stated threshold, you regain termination rights
Example:
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Offer: $600,000
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Partial waiver: $15,000
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Appraisal: $560,000
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Gap = $40,000
Because $40,000 > $15,000:
➤ You can terminate OR renegotiate.
You are not required to pay the whole difference.
Best used when:
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You want to write a strong offer
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You expect the home to appraise close to price
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You want protection beyond a certain dollar amount
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You don’t want unlimited financial exposure
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You want maximum leverage with the seller
Partial waivers win homes without exposing you to massive risk.
4. No Appraisal Waiver (Most Protection, Weakest for Sellers)
With no waiver:
✔️ You can terminate if the appraisal is low
✔️ You protect your earnest money
✔️ You can renegotiate
✔️ You have maximum safety
Downsides:
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Weaker offer in competitive situations
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May lose to buyers with waivers
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Sellers may perceive financing risk
Still, this is the safest option for buyers who want airtight protection.
5. FHA and VA Loans Cannot Waive the Appraisal
If you are using FHA or VA financing:
✔️ A full waiver is NOT allowed
✔️ A partial waiver is NOT allowed
✔️ You CANNOT be forced to pay above appraised value
✔️ You retain strong termination rights
This is critical for buyers with government-backed loans.
6. When I Recommend a Full Appraisal Waiver
I only advise this when:
✔️ You have plenty of cash
✔️ The home is in a low-turnover neighborhood
✔️ Comps strongly support the price
✔️ The listing was intentionally underpriced
✔️ You understand your exact financial exposure
Full waivers are powerful, but only when used wisely.
7. When I Recommend a Partial Appraisal Waiver
This is my favorite strategy for most competitive situations.
I recommend partial waivers when:
✔️ The home has multiple offers
✔️ You want to win without overexposing yourself
✔️ The market is appreciating rapidly
✔️ You have some extra cash, but not unlimited
✔️ The comps are decent but not perfect
✔️ The home is unique or highly desirable
Partial waivers offer a great balance of strength and protection.
8. When I Recommend No Waiver at All
I recommend no waiver when:
✔️ Inventory is rising
✔️ Competition is light
✔️ The home is clearly overpriced
✔️ Appraisal risk is extremely high
✔️ Buyer’s cash reserves are limited
✔️ The buyer is risk-averse
Sometimes the strongest position is simply keeping your protections intact.
9. How I Reduce Your Appraisal Risk Before We Ever Submit an Offer
Before we waive anything, I show you:
✔️ Recent sales
✔️ Pending comps
✔️ Price-per-square-foot trends
✔️ Appraisal history in the neighborhood
✔️ Market velocity
✔️ Seller strategy (overpriced vs underpriced)
✔️ My projected appraisal range
You’ll know the best-case and worst-case scenarios before you commit.
10. How Waivers Affect Your Cash-to-Close
Using waivers can significantly affect:
✔️ How much cash you need
✔️ Your financing structure
✔️ Whether concessions are allowed
✔️ Your long-term affordability
I walk you through every scenario with clear numbers.
11. My Rule of Thumb
**If you want to win at all costs, use a full waiver.
If you want to win smartly, use a partial waiver.
If the home has issues, use no waiver.**
Bottom Line: Appraisal Waivers Are Powerful—but They Must Be Used Carefully
When used correctly, appraisal waivers can:
✔️ Help you win in multiple-offer situations
✔️ Reduce seller fear
✔️ Strengthen your financing position
✔️ Set your offer apart
But they also come with financial consequences.
When I represent you, I make sure you understand:
✔️ Your upside
✔️ Your downside
✔️ Your cash exposure
✔️ Your termination rights
✔️ Your negotiation options
You will never waive the appraisal blindly.
Want a Realtor Who Knows How to Use Appraisal Waivers Strategically?
If you want to win homes in competitive North Texas markets WITHOUT unnecessary risk, I’d love to help.
