VA Loan Appraisal Process - Quicken Loans Zing BlogOne of the requirements of receiving a VA loan is that you must have an appraisal performed on the property. What does this mean for you? If you are a first-time home buyer, or if this is your first VA loan, the idea of getting an appraisal can be daunting. But, if you remind yourself that the appraisal process is there to protect you, the buyer, from paying more than fair-market value for your home, then it actually becomes quite painless.

Once you begin the VA loan process, your home loan expert will be able to schedule a VA-approved appraiser for you. The Department of Veterans Affairs handles the scheduling and randomly assigns an appraiser to your property. Because it’s their job to ensure that the home meets minimum property requirements as set by the VA, appraisers must also guarantee that the home is safe and habitable. Typically, the appraisal is requested early into the VA loan process to ensure there will be enough time to address any issues that may result from the appraisal.

And just as the VA has strict requirements for VA loan eligibility, they also have stringent performance rules for appraisers assigned to VA homes. According to the VA Lender’s Handbook, appraisers “should keep up to date on major real estate market conditions and trends in order to properly analyze the location-related information contained in appraisal reports.”

Appraisers must inspect the potential property inside and out. They are also required to select and view the exterior of comparable homes and perform a comparative analysis. Typically, appraisers look for things like structural issues, or any other problems that could impact the purchase of the home. The VA prefers that homes be move-in ready.

Typical issues that arise on appraisal reports include homes without an efficient and acceptable source of heat. A heating system must maintain a minimum temperature of 50 degrees in the plumbing areas of the home. There must be adequate and code-approved electrical systems with all the proper fixtures. A leaky roof – or a roof that has problems – along with windows that have broken or damaged frames and seals can be a huge issue on an appraisal report.

Appraisers must include a location map, building perimeter sketches and photographs of either the sale property or the lot where the new home’s construction is going to take place. They also provide an itemized list of repairs required to be completed in order for the VA loan to be approved. This list also includes any corrections needed in order to make the property conform to regulations set by the Department of Veterans Affairs. Then, they must personally make the final-value estimate and sign their name to the appraisal report. They cannot delegate these tasks.

An appraisal doesn’t have to be a scary, daunting step in your effort to buy a home. To help streamline the process, make sure your realtor is well versed in VA property guidelines. Having an agent who continues to show you properties that are ultimately ineligible for a VA loan is a waste of your time. It’s also very important to work with an experienced VA lender. Lenders who have dedicated VA loan experience know the ins and outs of every VA regulation and can help guide you through the home buying process with ease. If you follow these two suggestions, while educating yourself on the appraisal process – you’ll be living in your dream home before you know it.

 

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This Post Has 17 Comments

  1. Hello,

    I am currently looking at homes and looking to use my VA loan, but many of the homes in the area that I’ll be moving to are very old and need updates. How will something like an ungrounded electrical system affect my ability to buy a home with a VA loan? I understand that the VA will not cover renovation costs in the total loan amount, but will something like this prevent me from buying the home, even if we’re willing to pay out of our own pockets to correct the issues once purchased? Other common factors I’m encountering in my search are roofs that need work/to be replaced, or HVAC system needing updates.

    Thank you,
    Michelle

    1. Hi Michelle:

      There are a few scenarios that might be applicable here. Ultimately, it’s going to depend on the house and the specifics of the situation, so you want to talk to one of our Home Loan Experts. That said, I can give you a little information. If you’re paying for the repairs out-of-pocket, you may just get any necessary repairs affecting livability of the property completed before moving in. If weather or a shortage of building materials made it impractical to complete the repairs before close, you might be able to do what’s called an escrow hold back in which case part of your loan funds would be dispersed after the repairs. You would have up to six months to complete repairs. For more information, I recommend you speak with one of our Home Loan Experts by calling (888) 980-6716. They would be able to go over specifics and restrictions in much greater detail.

      Thanks,
      Kevin Graham

  2. tell Me more about eligibility for second va loan for second home. I want to buy the house across the street, renovate for elder care and rent out for now.

    1. Hi Doug:

      Unfortunately, the VA only allows these loans to be used on primary residences. We can help you look into a second home, but it’s going to be an option like a conventional loan from Fannie Mae or Freddie Mac. If you’d like to go over your potential options, you can get in touch with us by filling out this form or calling (888) 980-6716 to speak with one of our Home Loan Experts.

      Thanks,
      Kevin Graham

    1. Hi Chris:

      Costs vary with every loan. We can also build the closing costs in in a lot of cases. I’m going to recommend you start by speaking with one of our Home Loan Experts to go over your situation in more detail. You can get in touch with us at (888) 980-6716.

      Thanks,
      Kevin Graham

  3. Can I use a VA Loan at my overseas posting?

    I’m PCS for a longer stint then I planned and the housing market is rather steep here.

  4. Hi, my wife and have been trying to refinance our mortgage to lower the interest rate and our monthly mortgage payment. We have 3 buildings in our 2 acre property. One is our home residence, two is a ministry house ,where we host our speakers, third the building is where people gather to be trained and ministered . My wife and are ordained pastors. We have tried to refinanced with our local banks and have not been able to help us. How can you help in this matter, The monthly payment is being paid by direct deposit.

    1. Hi Pedro:

      I’m going to suggest you talk to one of our Home Loan Experts. It sounds like you have some mixed-use operations going on with this property and there are some special guidelines are around that. If you call (888) 980-6716, they can look into your situation and give you a more definitive answer than I can on this.

      Thanks,
      Kevin Graham

  5. Are there any closing costs the veteran buyer is not allowed to pay and will become seller’s responsibility even though contract does not call for seller to pay any closing costs for buyer?

    1. Hi Linda:

      There are no such costs. This used to be the case for repairs, but it no longer is. Those can be paid by the buyer or seller, at least under our policies. Hope this helps!

      Thanks,
      Kevin Graham

  6. My husband and I have a closing date next month..but we are having to jump through hoops to get this.. was not prepared to pay 12 months of home insurance in advance..was not prepared to have more assets that we actually keep in our bank account..we live in an apt now and after buying our home our finances will be 10x better..anyone else come anyone cross similar issues?..both my husband and I are disabled and we live on a fixed income..so it is very overwhelming

    1. Hi Alice:

      I’m going to have one of our Home Loan Experts reach out and see if we can give you some advice. Thanks for reaching out!

      Kevin Graham

  7. Hello Gilbert, I don’t see any earlier response to your question and I’m wondering if anyone from Quicken got back to you. I also would like to have a home built with a VA Loan and would like some information on the process, Thanks Gilbert or anyone else.

    1. Hi Chip! At this time Quicken Loans does not do construction loans. However, once the house is built and you’re residing in the home, we can refinance you into a conventional loan. I’ve passed your comment on to our team of mortgage experts who can discuss this in more detail with you.

  8. I am elegible for a second VA home loan. How can this be used for building a new home? The builder is a small company and can not provide financing, requiring a construction loan with permanent financing upon completion. Per local bank, this would require two separate closings and 20% down payment although credit score is approx 800. As I am getting close to retirement age, I do not want a lot of cash tied up in home equity, so a VA loan with $0 down would be ideal for my situation.

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