Once you find the home of your dreams, you’ll have to take several steps before you can call it your own. If you’re using a VA Home Loan to make your purchase, you’ll need to get a VA appraisal.

But what is a VA appraisal and how is it connected to your VA Home Loan? How does a VA appraisal work?

Let’s take a closer look at the VA appraisal process so you can prepare for your homebuying journey.

What Is a VA Appraisal? 

A VA appraisal is an unbiased professional opinion of the home's market value — the amount the independent VA appraiser thinks a buyer would offer to purchase the home. This value is influenced by recent sales of similar properties and by current market trends. 

Lenders want to ensure the homebuyer or homeowner isn’t overborrowing on a property because the home will serve as collateral for the loan. Lenders also need to document that the property meets both the VA and its guidelines. Unlike traditional appraisals, VA guidelines ensure that the home being financed meets the VA minimum property requirements (MPR) for a safe, structurally sound, and healthy dwelling.

How Does the VA Appraisal Process Work? 

Most VA appraisals follow the same set of steps, making it easier for you to get an idea of what to expect.

The Lender Hires an Appraiser

Generally, the buyer will pay for the appraisal. Note that VA appraisals vary by region, so it’s a good idea to familiarize yourself with the average appraisal cost in your area or the area where you plan to move.

The Initial Inspection

VA-approved appraisers will assess the property’s safety, condition, and its compliance with VA MPRs. They’ll also verify the property's square footage, amenities, and overall livability to ensure its value.

The Comparison Analysis

After assessing the general value of the home,  appraisers compare it to similar properties in the area to determine its fair market value. They’ll consider factors such as location, size, age, condition, and recent sales of comparable homes.

The Appraisal Report

Your appraiser will compile the information acquired in the previous two steps into a comprehensive appraisal report. 

Submission of the Appraisal Report

The appraiser will submit the appraisal report, which documents the home’s information, to the lender handling your VA Loan application. The lender then reviews the appraisal to ensure it meets VA guidelines and supports the loan amount requested. 

The Lender’s Decision

The VA lender will make a final decision on the approval of the loan based on the appraiser’s report. Remember, this process ensures you are being given a fair price for a house that meets the VA’s housing requirements and safety standards.

How Long Do VA Appraisals Take? 

The whole process to get an appraisal done typically takes about one to two weeks. Some factors that could  influence the length of time your appraisal will take include:

• The availability of an appraiser in your area;
• The complexity of the property, including any unique features;
• Your appraiser’s current workload.

Despite factors outside your control, including the availability of appraisers in your area, you can help the process flow more smoothly by taking the following steps:

• Gathering  Appropriate Documentation: Prepare your documents ahead of time and have them ready to go as soon as you’re assigned an appraiser.
• Maintaining Communication: Be proactive about staying in touch with your appraiser and let them know that you’re ready to answer any questions or provide additional information as needed.
• Choosing an Experienced VA Lender: A lender who’s already familiar with the VA appraisal process will work more efficiently.

Validity of VA Appraisals 

The validity of your appraisal begins on the date of completion. The appraisal’s term of validity will depend on the housing market, with most appraisals being valid for 90 days. In a sellers’ market, the validity may last just 30 days, and other times, it may last as long as six months. 

Keep in mind that lenders may not honor an expired appraisal, so make sure you know how long yours will last. If your appraisal does expire, you can request a new one. If anything about your intended property has changed during that time, be prepared to provide documentation for the new appraisal. Also, note that getting a new appraisal will extend the timeline for buying a home.

Who Pays for a VA Appraisal? 

Buyers typically pay for the VA appraisal, and the fee will vary by region. As a potential home buyer, you’ll have to include the appraisal fee in the total cost of buying a home. 

Sometimes buyers can negotiate with sellers to cover some or all of the appraisal cost. Additionally, sellers might be encouraged to cover some or all of the fee to “sweeten” the deal for buyers or as a concession if the appraisal value doesn’t match the asking price (also known as an “appraisal gap”). However, it’s rare for sellers to cover the appraisal fee.

If you face an appraisal lower than your offer, you have several options, such as paying the difference, renegotiating the offer with the seller to see if they will lower the price to meet the appraised value, disputing the appraisal, or walking away from the sale. Each option has its own considerations and potential risks, particularly if you lack an appraisal contingency in your contract and have put money down. Many lenders will guide you on how to raise these concerns. Information on requesting an “Reconsideration of Value” or ROV may be included in appraisal documents or provided before the appraisal is conducted. 

Meeting VA Loan Requirements 

Compliance with VA appraisal standards is essential for securing a VA Home Loan, as these standards serve as a benchmark for the property's quality and suitability for long-term occupancy. The standards are expressly set in place to protect the well-being of Veterans and their families by preventing them from purchasing unsound properties.

Your VA appraiser will specifically check the following items:

• Access: The property needs to have safe access from the street (a private driveway or permanent easement).
• Mechanical systems: Electrical and plumbing systems must be safe and have some usable life remaining.
• Heat: The home’s heating system must be safe and able to keep a home’s temperature above 50°F. Homes with wood-burning stoves as their primary heating source must also have a conventional heating system that can maintain an adequate temperature to meet the MRPs.
• Water: Homes must have a safe water supply, a water heater, and a safe method of sewage disposal. Connection to a public water supply isn’t required unless mandated by local codes or health authorities. Private wells and water supplies will need to meet local or federal water quality standards.
• Roofing: The roof must provide reasonable future utility with no missing shingles or gaping holes.
• Basements and crawl spaces: Basements and crawl spaces must be dry, clear of debris, and adequately vented. 

Note that the above isn’t a complete list, and your specific appraisal requirements may vary.

Issues such as property condition deficiencies, safety hazards, or failure to meet VA guidelines can arise during the appraisal process. These problems could impact your loan approval.  You will want to address any issues as quickly as possible to help speed up the appraisal process.

Let AAFMAA Help You Buy a Home

Find out about all of AAFMAA’s comprehensive Member benefits, including AAFMAA Mortgage Services LLC (AMS) for mortgages to build, buy, or refi a home, or contact us now to learn about our many other insurance, home loan, and military wealth management programs for servicemembers, Veterans, and their families.

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This article was originally published December 2, 2020.