In this study 'iterative peeling' is introduced, a method equivalent to the traditional recursive peeling method for computing exact likelihoods in nonlooped pedigrees, but which can also be used to obtain approximate likelihoods in looped pedigrees. Iterative peeling is an interesting tool for animal breeding, where exact recursive peeling is generally unfeasible due to the abundant number of loops in animal pedigrees. In simulations, hypothesis testing and parameter estimation were compared based on approximate likelihoods in looped pedigrees and exact likelihoods in nonlooped pedigrees, showing no biases introduced by the approximation in looped pedigrees.