Are VA Appraisals Different? | Hero Home Loans
There are many benefits to a VA loan, and one of them is the VA appraisal process. Though it shares many similarities with a typical home loan appraisal, a few notable differences can benefit the potential home buyer. First, the VA wants to ensure that the homes are without serious issues and takes extra precautions to ensure their borrowers get quality homes at fair prices.
VA Appraisers Vs. Traditional Appraisers
With other types of loans, the person appraising your home might have connections to your lender, the real estate agent, the company, or the homeowner. As a result, you might have to wait for their availability to open up before you can complete the appraisal process, lengthening the homebuying process.
With VA appraisals, the person who will appraise your potential home is assigned at random by the VA, meaning they will have little interaction with the people involved in the potential sale of the home. Additionally, the VA works to assign licensed VA appraisers with less heavy workloads to help speed up the homebuying process.
The Timeline
A licensed VA appraiser is assigned immediately after ordering, and the turnaround time on their report is typically 7-10 days.
The Depth of the Appraisal
The VA doesnât want to invest in homes that are potential money pits, so VA appraisals focus on not only determining the worth of the home but also ensuring that the home is of good quality and without the need for significant repairs.
While other home loan appraisals are relatively simple, VA appraisals include an inspection of the house similar to a home inspection. A VA appraisal is designed to check the aspects of a home most essential to its functioning. It will examine the soundness of a houseâs foundation, its mechanical systems, and the condition of gutters and plumbing, among other things. The VA wants to ensure that the property is safe, clean, and structurally sound.
The VA has a set of guidelines called MPR (minimum property requirements) that the appraiser must follow. Although some requirements overlap, the VA guidelines differ from those for FHA or Conventional loans. For example, under VA guidelines, peeling paint is a common issue that must be rectified before closing.
Though a VA appraisal is thorough, an independent home inspection should still be conducted. With a VA appraisal and a traditional home inspection, you can rest easy knowing your home has been thoroughly examined by two experts, making it much less likely that something has been missed.
VA Appraisal Costs
VA loans allow homes to be purchased without money down and for some closing costs to be covered by the loan, but the appraisal cost is usually the buyerâs responsibility. Appraisal costs can vary widely with traditional home loans, but the Department of Veterans Affairs has established a fee schedule for VA appraisals that are strictly enforced. This is because the VA wants to ensure borrowers donât pay an exorbitant fee for their appraisal.
The base fee is typically $700. However, an appraiser may decide to charge more if there are complexities involved with the property.
On the other hand, VA Streamline Refinance requires no appraisal, so there are no out-of-pocket costs associated with it. However, some lenders under this program may charge for exterior appraisals.
Ability to Contest Appraisal Results
If you or the realtor are unhappy with the results of the appraisal, you can contest it. It is a process called Reconsideration of Value and is typically used when the homeâs sale price is higher than the value at which it was appraised. The VA will conduct a formal appraisal review, and evidence such as comparable homesâ appraisal and sale price data can be presented, although it is not required.
VA appraisals are thorough and fairly priced. To learn more about the VA loan process or to see if it might be the right home loan for you, contact Hero Home Loans.
