Is Your VA Appraiser’s List of Required Repairs Creating Problems?
Homebuyers looking to finance a home purchase with a Veterans Administration (VA) insured loan are sometimes surprised to find that they are not allowed to purchase or refinance a particular property because it doesn't meet VA lending requirements.
These "other" requirements are called the VA Minimum Property Requirements (MPRs). VA created its requirements to protect the veteran and the Government’s investment in the property.
Appraisers are not licensed home inspectors therefore they cannot operate a home’s systems. Nonetheless, the list of MPRs is extensive, and because it has to apply to multiple states, oft times vague.
The appraiser will collect comparable sales information to complete a Uniform Residential Appraisal Report. They will also evaluate the home to determine if it complies with the MPRs and will recommend repairs they deem necessary. There is little challenge to the appraiser’s opinion, which can be erroneous. Since the loan underwriter will demand these repairs be made prior to proceeding, the seller or owner must typically comply to pass the appraiser’s re-inspection. Because they can charge another fee for a return visit, this situation increasingly incentivizes finding myriad defects—an unintended consequence leading to extra expenses for veterans refinancing their homes or contributing to the prevailing market’s aversion to VA offers.
Something that is not common knowledge is that the appraiser does not make the determination if a home is or is not eligible for the mortgage- it is the underwriter who independently makes this decision based on all available information. If you think the VA appraiser is recommending repairs that are misguided, we can provide solutions and effective rebuttals to put closings back on track—without paying the appraiser’s self-initiated re-inspection fee.
Here are two recent examples where we were able to jump in and help get the settlement process back on track.
The appraiser required installation of an interior drain tile and sump pump due to this water on a detached garage floor. We found and corrected the problem, saving the owner several thousand dollars that would have been spent installing an unnecessary perimeter drainage system.
The appraiser required lead paint abatement for this window and the closing was postponed. We tested and cleared the window to put the closing back on track.