What is a VA appraisal: How they work and requirements

The VA has its own unique home appraisal process. The VA appraisal has two jobs:

• To determine the home's market value
• To make sure the home meets the VA's Minimum Property Requirements (MPRs)

For a VA home loan to move forward, the home you're purchasing will have to check both of these boxes.

What are VA home loan appraisals?

Every mortgage lender should order a home appraisal once a borrower applies for a loan. Typically, for a conventional loan, a licensed home appraiser visits the home and sets its market value. This value helps set the maximum loan size the lender will approve.

A VA appraiser measures market value while also making sure the home meets the VA's safety and security standards, known as Minimum Property Requirements, or MPRs.

The Department of Veterans Affairs requires MPRs because it does not want veterans using their VA benefits on homes that need extensive repairs or present safety hazards.

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How the VA appraisal protects the lender and veteran

VA appraisals provide essential protection for lenders and buyers:

• For veterans and active duty personnel buying homes: The appraisal helps service members avoid purchasingoverpriced or unsafe properties. By ensuring homes meet basic quality standards, the VA helps veterans avoid costly repairs and potential health hazards. The inspection portion of the VA appraisal identifies issues that might otherwise remain hidden.
• For lenders: These appraisals protect financial institutions by confirming the property serves as adequate collateral for the loan amount. Since VA loans typically require no down payment, the appraisal helps mitigate risk by verifying property value supports the loan.

The appraisal process maintains the integrity of the VA loan program itself. By ensuring every property meets MPRs, the program maintains a standard of quality across all VA-backed purchases, regardless of location or price point. 

How does a VA loan appraisal work?

The VA appraisal's home inspection typically takes 30 to 45 minutes but provides years of protection for both veteransand their families and the lenders who underwrite VA loans. 

Here's what to expect:

Step-by-step overview

Once you sign a purchase agreement, your VA loan moves through these appraisal steps:

1. Your lender orders the appraisal through the VA portal
2. The VA assigns an approved appraiser (lenders cannot choose their own appraiser)
3. The appraiser schedules and completes the property inspection
4. The appraiser researches comparable sales in your area to assess market value
5. A final appraisal report gets submitted with the property's estimated value and MPR compliance status

Who conducts the appraisal

Only VA-approved appraisers can perform VA appraisals. The VA requires its appraisers to complete specialized training. The VA also wants appraisers to maintain independence from VA lenders. This helps ensure fairness in accuracy in the appraisal report.

VA-authorized appraisers follow strict guidelines to determine property value and assess Minimum PropertyRequirements compliance.

Timeline and scheduling

The appraisal inspection takes 30 to 45 minutes to complete, but it takes longer to schedule. Homebuyers should expect to wait seven to 10 business days, depending on current demand in the area.

In rural areas, or during busy buying seasons, the wait may be a little longer.

Veterans cannot order appraisals directly. The mortgage lender begins this process through the VA portal. This system is designed to prevent conflicts of interest between appraisers, lenders, and borrowers.

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Minimum property requirements

So what are the Minimum Property Requirements that a VA-financed home must meet? They're designed to make sure your home is move-in ready with functional systems, adequate living space, and proper utility access.

To meet MPRs, a home must be:

• Safe: The appraiser will look for secure handrails, proper electrical systems, and absence of hazards
• Sanitary: The home must be connected to a functional sewage system, have ready access to potable water, and adequate ventilation
• Structurally sound: Sound foundation, roof without significant damage, and absence of wood-destroying insects
• Accessible: The home must have access from a public road 

VA appraisers evaluate each of these elements to ensure you're purchasing a property that won't compromise your family's wellbeing.

Common issues that can delay approval

Properties frequently fail VA appraisals due to:

• Peeling paint in homes built before 1978 (lead paint concerns)
• Inadequate heating systems
• Water damage or active leaks
• Missing handrails on staircases
• Non-functioning appliances or mechanical systems

These issues must be resolved before VA loan approval can move forward. Often, sellers handle repairs or provide concessions to keep the sale on track, but understanding these potential roadblocks helps you prepare for possible delays or negotiations.

VA appraisal fees

VA appraisal costs vary across the country, and understanding what you'll pay helps with proper budgeting for your home purchase.

Typical VA appraisal fees by region

VA appraisal fees range from $450 to $800 nationwide, with prices set by the Department of Veterans Affairs rather than individual lenders. The home appraisal costs more in rural areas or in other locations with limited VA appraisers.

Prices fluctuate based on:

• Property size and type
• Regional housing market conditions
• Property location accessibility

Who is responsible for payment?

Unlike other closing costs, borrowers typically pay for the VA appraisal upfront when it's ordered. This fee becomes part of your closing costs, but it's normally collected separately and earlier in the loan process.

Once an appraisal is ordered and completed, the appraisal fee is no longer refundable, even if the loan doesn't close.

How the VA appraisal differs from other loan types

VA appraisal fees often run slightly higher than conventional loans because they include both valuation and a propertyinspection.

FHA appraisals have a similar dual-purpose but with different requirements. The VA appraisal contingency offers you unique protections that justify the extra cost.

VA appraisals also feature standardized fees within regions, while conventional appraisal costs vary more widely by lender and appraiser.

Can I still get my own home inspection?

VA appraisals check for Minimum Property Requirements (MPRs), but they don't replace a full home inspection. Buyerscan and should hire their own home inspector to check out the property from top to bottom. A private home inspectionadds costs but also show buyers more about the property beyond the VA's checklist.

Not sure where to find a home inspector? Your real estate agent can help. 

What if a VA appraisal comes in low?

When your VA appraisal returns a value lower than the purchase price, you face a "value gap" between what you agreed to pay and what the VA considers fair market value. This situation can be a roadblock in the home buying process.

To keep the loan process on track, you may need to:

• Ask the seller to lower the sales price to match the appraisal value
• Pay the difference between the appraised value and purchase price out-of-pocket
• Request a Reconsideration of Value (ROV) if you spot factual errors in the appraisal
• Walk away from the deal using your appraisal contingency protection
• Negotiate a compromise where both parties split the cost difference

The ROV process lets you challenge the appraisal by submitting additional comparable sales or identifying mistakes in the appraiser's determination. This rarely produces significant changes to the original value.

Some sellers will lower the purchase price to avoid starting the selling process over with new buyers. 

When negotiations fail, you can explore other loans or different properties. Remember that your appraisal protects you from overpaying. It ensures you receive fair value for your investment while maintaining your long-term financial security.

Other FAQs about VA home appraisals

What does a VA appraiser look for during the inspection?

A VA appraiser evaluates the property's safety, sanitation, and structural integrity. They check for functional systems, adequate living space, proper utility access, and compliance with Minimum Property Requirements (MPRs). This includes examining electrical and plumbing systems, the roof condition, foundation integrity, and the potential for other safetyy hazards.

How long does the VA appraisal process typically take?

The entire VA appraisal process takes up to 10 business days from ordering the appraisal to receiving the final appraisal report. The actual on-site inspection typically lasts less than an hour. These time estimates can vary based on the size of the home and the local market. 

What are the typical costs associated with a VA appraisal?

VA appraisal fees generally range from $450 to $800 nationwide. The exact cost varies by region and is set by the Department of Veterans Affairs. Factors affecting the price include property size, type, location, and local market conditions. The veteran homebuyer is usually responsible for paying this fee upfront.

How does a VA appraisal differ from a conventional appraisal?

VA appraisals serve a dual purpose of determining fair market value and ensuring the property meets specific Minimum Property Requirements. They follow stricter guidelines and include a more thorough property inspection compared to conventional appraisals. VA appraisals also have standard fees within regions.

Do refinance loans require a new VA home appraisal? 

Sometimes. The VA IRRRL usually does not require a new VA appraisal. A VA cash-out refinance typically does since it can refinance a home into the VA loan program.

Better + VA = a commitment to transparency

VA appraisals protect veterans and VA lenders through a unique dual-purpose evaluation that goes beyond standard market value assessments. While Minimum Property Requirements add an extra layer of scrutiny, this extra protection helps you avoid costly surprises after closing.

Better Mortgage extends this commitment to military families by providing a transparent and fast VA home loan processthat also prevents surprises along the way. 

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