Similar to other types of mortgages, VA loans require that an appraisal be performed in order to determine the property’s market value. However, a VA appraisal will go a step further to also determine that the property meets the VA’s Minimum Property Requirements (MPR) which places an emphasis on any hazard that will adversely affect the health and safety of the homeowner and occupants. It is also important that the structural soundness of the home is acceptable so that the homeowner and its occupants can live comfortably and enjoy the home.
Below are the property requirements for a VA loan and the most common issues that may have an impact on the VA appraisal:
– Under the MPR, proposed and under construction properties must be built according to building code, Federal regulations and HUD requirements. For existing and new construction properties, the home must be safe, structurally sound, sanitary and meet the acceptable standards for a permanent home relevant to its location.
– When it comes to safety, the VA appraiser will notice conditions that are in need of repair, such as broken handrails, deck guardrails, broken concrete, missing outlet or switch covers (electrical hazard), broken windows, poor ventilation of heating systems.
– The VA appraiser will look for conditions such as defective construction, poor workmanship, continuing settlement of the property, leakage, excessive dampness, lead based paint, decay and termites.
– Wood destroying insects can create a home that is unstable. The VA appraiser will look for and report any evidence of insect infestation, fungus growth and dry rot. This is in addition to an inspection by a wood destroying insect inspector.
– Water leaks can causing rotting of wood and/or mold and mildew, all of which can leave a home unstable. Any water issues will be noted, such as leaks from a bad roof, water pipes, drain pipes and even siding and trim where caulking is worn. Water that appears in lower levels can be a sign of improper grading, damaged gutters or cracks in the foundation. Any visible cracks in the walls can be an indication of a foundation problem and potentially unsound home. Water can eventually cause mold and mildew which can pose a serious health risk to humans. These deficiencies will need to be addressed and corrected prior to any loan approval.
– Water must be safe to drink and have less than the maximum contamination levels required per EPA or local jurisdiction having authority. The property must have domestic hot water, a continuous supply of safe and potable water used for drinking and other household uses.
– Water quality for an individual water supply (wells) and community water systems must meet the requirements in place by the health authority that has jurisdiction. The well water must be able to provide a continuing supply of safe and potable water. It may be required to be tested to determine that Coliform Bacteria, Lead, Nitrate levels and others are below the maximum contamination levels.
– The home must have sanitary facilities with a safe method of sewage disposal, whether public or septic, that work properly. An individual sewage disposal system (septic) must be able to dispose of all domestic waste in a way that does not create a nuisance or endanger public health. Septic systems may be required to be tested. An approved lender can help you determine if a septic test will be needed.
– Private streets must be protected by a permanent easement and maintained by a homeowner’s association or maintenance agreement.
VA approved appraisers, who are appointed by the VA loan system, are familiar with the process for the Minimum Property Requirements and will perform the appraisal accordingly and in a timely manner. While a VA appraisal is more detailed than other types of appraisals, it is also another method used to protect the VA home buyer. Any impairments discovered will need to be remedied prior to the VA loan closing so that the probability of further damage is eliminated, the home is safe and sound and the homeowner can enjoy their home purchase.
Feel free at any time to contact us for more information about the property requirements for a VA loan.
My loan process was very easy and quick. Not to mention a great loan rate. I couldn't be happier!
Capt Sam T. - US Army
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