WHAT IS A VA APPRAISAL?

A VA appraisal is a necessary part of obtaining a VA loan. While it sounds like a home inspection, it's different. The purpose of the appraisal is to determine the fair market value of the property, as well as ensure its safe condition. This is the reason why VA loans are usually unable to be given to "fixer upper" homes that are otherwise not livable. An appraisal will be ordered as soon as you enter into a purchase agreement for the property in order to reduce or avoid delays in closing that may come as a result of the appraisal findings.

WHAT DOES IT COST?

The fee for a VA appraisal ranges from $300-575, usually dependent on the state and/or area. The independent appraiser is not affiliated with any particular lender, and may not charge more than the amount charged to a civilian client for a comparative service. 

WHAT IF MY APPRAISAL REQUIRES IMPROVEMENTS TO THE PROPERTY?

It doesn't mean you can't still buy the property. Any repairs noted must be completed before closing on the loan. A lender may allow you to escrow for a repair when possible, or negotiating with the seller to cover repair costs may be another option. You'll likely be happier with your home purchase knowing the necessary repairs are made before you move in.

WHAT IF MY HOME FAILS THE VA APPRAISAL?

If your home needs more than minimal repairs it is not considered "move-in ready." This means it likely has major issues with health and safety concerns such as lack of heat, outdated electrical, roof damage, or pest or termite problems. These pose not only a threat to the homes inhabitants, but to the security of the loan and value of the property, therefore they cannot qualify for a guaranteed VA loan.

WHAT IF THE APPRAISAL IS LOWER THAN THE HOME'S LISTING PRICE?

If this is the case, you have a few options: 1. You can make up the difference with your own money. 2. You can ask for a reconsideration of value based on similar properties. 3. You can take a higher interest rate on the loan and request the lender credit you back to offset the difference. Or 4. You can ask the seller to cover the difference between the appraised value and the asking price.

The VA appraisal exists to help you purchase a home that will safely shelter you and your family for years to come, and to ensure that the VA loan remains viable and the best option for Veteran home buyers.