Do you need a VA appraisal to buy a home with a VA home loan?

Qualified U.S. veterans, active duty military personnel, and surviving spouses of veterans are eligible for VA home loans. These loans were created in 1944 as part of the GI Bill of Rights and the VA home loan program for returning WWII veterans. Now, these loans are used to help military personnel purchase a home with government assistance. With a VA home loan, the government guarantees the loan if the borrower can’t pay. These loans also come with lower down payment requirements and loan rates.

Since VA home loans are part of a government program, there are some different requirements that borrowers must meet to purchase a property. One of those requirements is a VA home appraisal. This type of appraisal occurs before the purchase is finalized, and for the financing to be secured, the property must meet certain expectations. Here’s an overview of some of the most basic requirements from NerdWallet.com:

• The property must have enough living space for sleeping and cooking as well as adequate bathrooms.
• The property needs to be safely accessible from a street.
• The property must have proper exterior drainage.
• The property must have safe and sufficient electricity.
• The property must have a safe and adequate water supply and sewage system.
• The roof needs to be in decent condition, with a properly vented and accessible crawlspace.
• If the property includes a basement, it must be structurally secure and dry.
• All property mechanical systems should be in good condition and safe to use.
• The exterior paint on the home should be adequate for protecting the property from weather damage. Loose, cracked, or paint containing lead must be removed and replaced.
• Any other structural conditions that undermine the safety of the property must be corrected.

As you can see, these conditions ensure that the property must be in decent shape and move-in ready. So VA home loans are not the best option if you are looking to buy a fixer-upper home. This appraisal aims to ensure that the property is safe and suitable for living since the government is backing the loan.

A VA appraiser must conduct a VA home appraisal, and a home inspection does not count. If the appraiser notes necessary repairs, they may need to be fixed before closing the sale. The appraisal report estimates the property’s value, which affects the VA loan amount. If the appraisal value is lower than the home’s market value, it may affect the loan application, so you don’t qualify for as much as you need. In this case, you can appeal the property’s appraisal value in writing and by submitting additional market data. Appraisers may consider this information and look at sales of nearby homes and other market real estate data to adjust the appraisal report and the value assigned to the property.

The VA appraisal process is complicated. It can also be time-consuming, but it’s designed to ensure these loans are used for safe, affordable housing for veterans and military families. At PRMI, we are very familiar with the VA home loan application process and can help you see if you are eligible for these programs. With our help, you can feel confident using this financing tool to purchase your home!