A VA appraisal is mandatory. If you are looking to purchase a home using a VA loan, you cannot opt out from a VA appraisal, unlike an inspection.
The appraisal must be done by a Certified VA Appraiser. It helps determine the property’s fair market value before the borrower buys the home. This will be requested and scheduled by the
VA lender. The lender will also be the one to communicate with the borrower once the report is out.
Who pays and how much does it cost?
The borrower pays for the appraisal and it is usually paid upfront. The home appraisal fee varies per state. On average, it costs around $300 to $500.It should be noted though that an appraisal is different from a home inspection. A separate fee would apply if a property inspection is conducted.
What are the purposes on a VA Home Appraisal?
There are two main reasons why an appraisal is performed, (1) it establishes the property’s fair market value, and (2) checks to see if the property meets the Minimum Property Requirements (MPR) set by the VA.
A VA-approved Appraiser’s job is not just to determine the value of the home, he/she also ensures that it is safe to live in, clean and structurally sound. They base this off VA’s MPR.
What if, after the appraisal, it was found out that the home’s value was short of the loan amount?
The report is completed and you find out that the appraisal value is lower than the loan amount you want to have. There are many ways you can go about it.
You can negotiate with the seller to lower the price to equal that of the appraisal value. You can file a petition for a value reconsideration with the Veteran Affairs. You can also pay the difference out of pocket.
What if the appraisal findings suggest that repairs are needed to be done for it to meet the MPR standards?
There are many choices you can make when faced with this dilemma. First, you can try to talk with your seller if they are willing to cover the cost of the repairs. You can also choose to pay for for the home repair yourself.
At this point, if you really need and want the house, there is no other way but to make the necessary repairs. It has to be done in order to meet the MPR criteria and get a VA financing.
When should a VA Home Appraisal take place?
The sooner the home undergoes appraisal, the better. It takes 10 days to complete. However, if the report suggests that repairs are needed, another appraisal may take place once the necessary work is done.
The appraisal is done early on and is performed by a VA-approved appraiser. They will give you unbiased reports and assessments on your property. They will also be willing to cater to your queries about this process and assist you along the way.