Demystifying VA Appraisals for Veteran Home Buyers
Imagine securing your dream home, only to have the appraisal value come in lower than expected - it's a scenario that can spell disaster, or it can be a hurdle easily navigated if you're equipped with the right knowledge.
In this episode, Richard dives deep into the importance of the VA appraisal process for veterans. He covers how it determines the home's sales price and that there is no difference between a VA appraisal and an FHA appraisal regarding value. Learn about the option to pay the appraisal gap and the important details of an appraisal waiver as an addendum to the contract.
Please tune in to learn how veterans can protect their earnest money!
[00:01 - 05:01] Understanding the Importance of the Appraisal Process for Veterans
VA appraisals are important for veterans when purchasing a property
An appraisal is ordered through the VA portal, not an appraisal management company
Appraiser usually accepts orders within 24 hours and has ten business days to deliver to VA
[05:02 - 10:51] VA, FHA, and Conventional Loans
If appraisal value is not met, a Tidewater is issued to both parties for additional sales info
Reconsideration of Value can be requested with VA if comps support it
The appraiser does a head and shoulders inspection for safety issues
Exposed wiring and smoke/carbon monoxide detectors must be fixed for any loan
If the appraisal comes in lower than the sales price, renegotiate or pay the gap between the two
[10:52 - 15:04] The VA Appraisal Process and Requirements for Home Buying
Veterans have the option of paying the appraisal gap
A VA escape clause is built into the contract to protect the veteran's earnest money if the house doesn't appraise for the sales price
Appraisal waiver is an addendum to the contract that states that no matter what the house appraises for, they're going to pay X price for the home
The seller should make sure improvements are known to the appraiser before inspection
Termite inspection needs to be done on the VA loan to determine if there is any problem
Quotes:
"There's not one difference between a VA appraisal and an FHA appraisal regarding value. They have to use the comps to make their adjustments on the comps that they're using." - Richard Sarey
"The other item that needed to be completed was to have smoke and carbon monoxide detectors. That's a safety issue. All homes should have that." - Richard Sarey
"You want to get the property ready in the best condition that it can be in before the appraiser comes out there." - Richard Sarey
